Democratic Institutions of Undemocratic Individuals - Privatizations, Labor, and Democracy in Turkey and Argentina PDF

DEMOCRATIC INSTITUTIONS OF
UNDEMOCRATIC INDIVIDUALS
PRIVATIZATIONS, LABOR, AND DEMOCRACY

IN TURKEY AND ARGENTINA
Peride K . Blind
pal9rave
macmillan
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DEMOCRATIC INSTITUTIONS OF UNDEMOCRATIC INDIVIDUALS
Copyright © Peride K. Blind, 2009.
Softcover reprint of the hardcover 1edition 2009
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ISBN 978-1-349-37670-4 ISBN 978-0-230-61789-6 (eBook)

DOI 10.1007/978-0-230-61789-6
Library of Congress Cataloging-in-Publication Data
Blind, Peride K.
Democratic institutions of undemocratic individuals : privatizations,
labor, and democracy in Turkey and Argentina / by Peride K. Blind.
p. em.
Includes bibliographical references and index.
ISBN 978-0-230-61158-3
1. Labor-Turkey. 2. Labor-Argentina. 3. Privatization-Turkey.
4. Privatization-Argentina. 5. Democracy-Turkey.
6. Democracy-Argentina. 1. Title.
HD8656.5.B65 2008
331.109561-dc22 2008025847
A catalogue record of the book is available from the British Library.
Design by Macmillan Publishing Solutions
First edition: January 2009
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Transferred to Digital Printing 2011

CONTENTS
List of Tables and Figures vii
Abbreviations and Glossary IX
Preface and Acknowledgments xv
Introduction: Democratic Institutions of Undemocratic

Individuals 1
1: A Recipe for Deciphering Democratization Today:

Privatizations and Labor 7
2: History of Labor Developments in Turkey: From
State-Dependent to Cautiously Autonomous Unionism 31
3: History of Labor Developments in Argentina:
From Peronist to Cautiously Independent Unionism 57
4: Turkish Labor in the Global Era:
Autonomous Unions and Transiently Unified Workers 85
5: Argentine Labor in the Global Era:
More Plural Unions and Atomized Workers 123
6: Effects of Privatizations on Labor: A Cross-Cultural
Comparison and Implications for Democracy 183
Notes 209
Bibliography 225
Index 253
LIST OF TABLES AND FIGURES
TABLES
1.1 Definitions of privatization 8
1.2 Workers involved in labor activity
(in thousands), 2001-2002 14
1.3 Working days lost due to labor activity, 2001-2002 15
2.1 Collective agreement making in Turkey (1996-2005) 54
3.1 Deputies of union background in the
Argentine House of Congress (1983-1995) 77
3.2 Revisions of collective agreements
in Argentina (1991-2001) 78
4.1 Classification of the Turkish labor
union system in the 1990s 97
4 .2 Classification of the Turkish labor
4.3 Focus Groups in Turkey, 2005 112
5.1 Classification of the Argentine labor
5.2 Classification of the Argentine labor
5.3 Sector-Wide comparison of labor federations
and unions within the CGT and the CTA 147
5.4 Focus groups in Argentina, 2006 161
6 .1 Pedagogic snapshot of Turkish and
Argentine organized labor after privatizations 184
viii LIST OF TABLES AND FIGURES
FIGURES
1.1 Trends oflabor conflicts (strikes) in
Argentina (1980-2002) 16
1.2 Trends oflabor conflicts (strikes and other
protest actions) in Argentina (2003-2005) 16
1.3 Trends of labor conflicts (strikes) in
Turkey (1996-2005) 17
2.1 Turkish deputies with union background (1940-2005) 50
6.1 Employment and unemployment levels as a result
of privatization in selected public sectors in
Argentina (1985-1996) 194
6.2 Employment and unemployment levels as a result
of privatization of SOEs in Turkey (1989-2005) 194
6.3 Worker typology and reactions to privatizations
in Argentina: Pragmatic reasoning and
union-bound action taking 196
6.4 Worker typology and reactions to privatizations
in Turkey: Ideological reasoning and collective
action taking 196
ABBREVIATIONS AND GLOSSARY
AFL-American Federation of Labor

AID-Agency of International Development
AKP-Adalet ve Kalkinma Partisi (Justice and Development Party)
ANAP-Anavatan Partisi (Motherland Party)
APDFA-Asociacion de Personal de Direcci6n de los Ferrocarriles
Argentinos (Association of Argentine Railway Managers)
APJGas-Asociacion de Personal Jerarquico (Union of Gas in Buenos
Aires)
ATE-Asociacion de Trabajadores del Estado (Union of Public
Employees)
ATTAG-La Asociacion por una Tasa a las Transacciones financieras
y Ayuda a los Ciudadanos (Association for Taxing Financial
Transactions and Help to Citizens)
BASIN-IS-Istanbul Print Workers Union in Turkey
CATEP-Confederacion Argentina de Trabajadores de Empresas
Privatizadas (Argentine Confederation of the Workers of Privatized
Enterprises)
CCG-La Corriente Clasista y Combativa (The Class-Conscious and
Combative Current)
Ce.P.E.Tel-Centro de Profesionales de Empresas de Telecomunica-
ciones (Center of Telecommunication Professionals)
CFSM-Comite de Movilizacion por el Forum Social Mundial
(Committee of Mobilization for the World Social Forum)
CGT-Confederacion General del Trabajo (General Confederation
of Labor)
CHP-Cumhuriyet Balk Party (Republican Peoples Party)
COA-Confederacion Obrera Argentina (Argentine Workers
Confederation)
x ABBREVIATIONS AND GLOSSARY
CoGT-Comision de Gestion y Trabajo (Commission of Administra-

tion and Labor)
CORA-Confederacion Obrera Regional Argentina (Regional
Workers Confederation of Argentina)
CTA- Central de los Trabajadores Argentinos (Congress of the
Argentine Workers)
CTERA-Confederacion de Trabajadores de la Educacion de la
Republica Argentina (Public Teachers Confederation)
DIU-Duyun-i Umumiye (Office of Foreign Debt Management)
DISK-Turkiye Devrimci Isci Sendikalari Konfederasyonu (The
Revolutionary Labor Unions Confederation of Turkey)
DSP-Demokratik Sol Parti (Democratic Left Party)
DSI-Devlet Su Isleri Mudurlugu (General Directorate of State
Hydraulic Works)
DP-Demokrat Parti (Democrat Party)
DYP-Dogru Yol Partisi (True Path Party)
ENTEIr-La Empresa Nacional de Telecomunicaciones
EOI-Export-Oriented Industrialization
ESOs-Employee-Share Ownership Programs
FAECYS-Federacion Argentina de Empleados de Comercio y
Servicios (Federation of Commerce Employees)
FATEIr- Federacion Argentina de lasTelecomunicaciones (Argentine
Federation of Telecommunications)
FATLyF-Federacion de Luz y Fuerza (Light and Power Federation)
FETERA-Federacion de los Trabajadores de Energia de la Republica
Argentina (Federation of the Workers of the Energy Sector of the
Republic of Argentina)
FETIA-Federacion de los Trabajadores de la Industria y Afines
(Industry and Industry-Related Workers Federation)
FNe-Federacion Nacional de la Construccion (Federation of
Construction Workers)
FNM-Federacion Nacional Metalurgica (National Federation of
Metallurgy Workers)
FOA-Federacion Obrera Argentina (Argentine Workers Federation)
FOECYT-Federacion de Obreros y Empleados de Correos
y Telecomunicaciones (Federation of Workers of Postal and
Telecommunication Sectors)
ABBREVIATIONS AND GLOSSARY xi
FOEESITRA-Federacion de Obreros, Especialistas y Empleados

de los Servicios e Industria de las Comunicaciones de la Republica
Argentina (Telephone Unions Federation)
FOETRA-Federacion de Obreros y Empleados Telefonicos de la
Republica Argentina (Federation of Telecommunications Sector
Workers)
FORA-Federacion Obrera Regional Argentina (Regional Workers
Federation of Argentina)
FTRA-Federacion de los Trabajadores de la Republica Argentina
(Federation of Workers of the Republic of Argentina)
GIDA-IS- Gida Sanayi Iscileri Sendikasi (Food Sector Union in
Turkey)
HAK-IS-Hak Isci Sendikalari Konfederasyonu (Confederation of
Turkish Just Workers Union)
HISB-Hur Isci Sendikalari Birligi (Free Labor Unions Federation)
ICFTU-International Confederation of Free Trade Unions
IDTs-Iktisadi Devlet Tesekkulu (State Economic Enterprises)
IISB-Istanbul Isci Sendikalari Birligi (Federation of Istanbul Labor
Unions)
1MB-Intermediary Management Body (term describing the new role
of a group of Argentine unions as a response to privatizations)
IPOs-Initial Public Offerings
lSI-Import-Substitution Industrialization
KIGEM-Kamu Isletmeciligini Gelistirme Merkezi (Public Adminis-
tration Development Center-Foundation)
KIKs-Kamu Iktisadi Kuruluslan (Public Economic Enterprises)
KITs-Kamu Iktisadi Kuruluslari (Public Enterprises in Turkey)
KRISTAL-IS- Cam, Cimento, Seramik ve Toprak Sanayi Iscileri
Sendikasi (Glassworkers Union in Turkey)
LASTIK-IS- Petrol KimyaVe Lastik Sanayi IscileriSendikasi (Rubber
Workers Union)
M/EBOs-Management or Employee Buy-Outs
MADEN-IS-Mineworkers Union in Turkey
MHP-Milliyetci Halk Partisi (Nationalist Peoples Party)
MISK-Milliyetci Isci Sendikalari Konfederasyonu (Nationalist Labor
Unions Confederation)
xii ABBREVIATIONS AND GLOSSARY
MSP-Milliyetci Selamet Partisi (Nationalist Security Party)

MTA-Movimiento de los Trabajadores Argentinos (Argentine
Workers Movement)
OAe-Osmanli Amele Cemiyeti (Ottoman Workers Association)
OI-Ozellestirme Idaresi (Privatization Administration)
OM-Ozelle~tirme Magdurlari (Victims of Privatizations, social
movement of the rank and file in Turkey)
ON-Oro Negro (Black Gold, social movement of the rank and file
in Argentina and unionized within the CTA)
O'I'Os-Osmanli Terakki Cemiyeti (Ottoman Association for Progress)
PAP-Politics of Above Parties (strategies and style of negotiation
employed by TURK-IS)
PETROL-IS- Turkiye Petrol Kimya Lastik Iscileri Sendikasi (Turkish
Petroleum, Chemical, Rubber Workers Union)
PJ-Partido Iusticialista (Peronist Justice Party)
PPP-Programas de Propiedad Participada (Employee Share Owner-
ship Programs)
PSO-Partido Socialista Obrera (Socialist Workers Party)
SDSB-Sosyal Demokrat Sendikalar Birligi (Movement of Social
Democrat Unionism)
SALs-Structural Adjustment Loans
SEKA-Turkiye Seluloz ve Kagit Fabrikasi (privatized paper and
cellulose producing former Turkish SOE)
SHP-Sosyal Demokrat Halk Partisi (Social Democrat Peoples Party)
SINAPA- El Sistema Nacional de la Profesion Administrativa
(National System for the Civil Service Profession in Argentina)
SOEs-State-Owned Enterprises
SPO-Devlet Planlama Teskilati (State Planning Organization)
SUPE-Federacion de Sindicatos Unidos Petroleros del Estado
(Labor Federation of Petroleum Unions of the State)
TBMM-Turkiye Buyuk Millet Meclisi (Turkish Grand National
Assembly)
TDI-Turkiye Denizcilik Isletmeleri (privatized Turkish SOE of
maritime administration)
TIP-Turkiye Isci Partisi (Workers Party of Turkey)
ABBREVIATIONS AND GLOSSARY xiii
TISK-Turkiye Isveren SendikalariKonfederasyonu (Turkish Employers

Association)
TKKO-Toplu Konut ve Kamu Ortakhgi Kurulu (Mass Housing
and Public Participation Administration)
TURK-IS-Turkiye Isci Sendikalari Konfederasyonu (Turkish
Confederation of Labor Unions)
TURK-METAL IS-Union ofMetal, Steel, Ammunition, Machinery,
and Automobile Assembly and Related Industry Workers of Turkey
UceDe-Union del Centro Democratico (Union of the Democratic
Center)
UCR-Union Civica Radical (The Radical Party)
UF-Union Ferroviaria (Union of Railroad Workers)
UGT-Union General de Trabajadores (General Workers Union)
UGTT-Union General de los Trabajadores del Transporte (General
Union of the Transportation Workers)
UPCN-Union del Personal Civil de la Nacion (Union of the Civil
Personnel of the Nation)
UIA-Union Industrial Argentina (Industrial Union of Argentina)
UOM-Union de los Obreros Metalurgicos (Union of Metallurgical
Workers)
YHK-Yuksek Hakem Kurulu (High Arbitration Board)
PREFACE AND ACKNOWLEDGMENTS
I started thinking about the questions of democracy and democ-

ratization when I was a high school student at Galatasaray Lisesi,
Istanbul. In this establishment, denominated as the "window of the
East opening to the West," I had the great opportunity and privilege
to meet and discuss with students and scholars from Turkey and all
around Europe the democratic and undemocratic attributes of the
Turkish political system. Having pursued my university studies in
the United States, I became convinced that neither Europe nor the
Middle East provided a theoretically sound and subjectively immune
area for grasping the democratization process in Turkey. I thus started
looking around the world and thinking outside the box.
This book project came into being in its most rudimental form
when Sabri Sayari, then director of the Institute of Turkish Studies
at Georgetown University, Washington, D.C., encouraged me to
stud y Latin America in greater depth for possible comparisons to
Turkey. Having received invaluable advice and constant attentiveness
from experts on democratization and Latin America at Georgetown,
I put forward a dissertation proposal under the guidance of John J.
Bailey. George Shambaugh supported the idea of examining the glo-
balization trends as discerned in the massive privatization programs
undertaken by the developing world . Andrew Bennett's intensive
courses on qualitative research methods contributed to the forging
of the methodological skeleton. Adrian Goldin engaged me in intel-
lectually nourishing discussions tracing the historical development of
labor in Argentina. It is to these experts and scholars that this book
is indebted to the most.
Countless individuals and institutions in Turkey, Argentina, and the
United States assisted me throughout the course of this book. All of
them contributed significantlyto my understanding of democratization
and labor politics, although none are responsible for any oversight or
error of analysis. In Turkey, I relied on the theoretical insights and rich
experiences of academics, civil society activists, and private sector lead-
ers such as Yilmaz Esmer, Ziya Onis, Emre Kocaoglu, Ayfer Egilmez,
xvi PREFACE AND ACKNOWLEDGMENTS
Aziz Celik, Salih Kilic, Gulay Aslantepe, Suleyman Celebi, Veysel

Tekelioglu, Tugrul Kutadgobilik, Faruk Buyukkucak, Mehmet Kilic,
Taskin Gundag, Mustafa Tas, Ali Ufuk Yasar, Yasar Erbas, Ayla
Yilmaz, Unver Uygar, Kurtcebe Gurkan, Mehmet Aydogdu, Demir
Atac, and Ozge Kemahlioglu.
In Argentina, my analysis benefited from the insights and
enriching discussions with Sergio Berenzstein, Juan Carlos Torre,
Sebastien Ethcemendy, Marcelo Jose Cavarozzi, Juan Abal Medina,
Walter Sosa Escudero, Carlos Acuna, Hector Palomino, Pedro
Elosegui, Cecilia Senen, Santiago Senen, Claudio Marin, Martha
Novick, Leticia Pogliaghi, Silvia Garro, Emannuel Ynoub, Adriana
Marshall, Rosalia Cortes, Natalia Araguete, Jose Tribuzio, Horacia
Meguira, Hector Recalde, Carlos Negri, Pedro Galin, Antonio Iara,
Guillermo Defays, Silvia Beatriz Di Leo, Roberto Izquierdo, Alan
Cibils, Jorge Sappia, Osvaldo Battistini, Damian Pierbattisti, Alvaro
Orsatti, Osvaldo Giardano, and Valeria Brusco. Victoria Murillo,
Peter Ranis, and Steven Levitsky provided generous contact infor-
mation and offered valuable comments on the research topic.
In Turkey and Argentina, numerous labor union leaders, at all levels
of hierarchy and representation, and blue-collar workers confided their
personal stories related to globalization, privatizations, and democracy.
These and other individuals opened their doors and offered both intel-
lectual and logistical assistance in penetrating the secluded world of
labor in both continents. Members of the Alumni Association of the
University of Illinois at Urbana-Champaign, Buenos Aires, provided
all kinds of help, ranging from logistical assistance to practical advice
and networking. My sincere thanks go to Mercedes Iacoviello and her
family, Marisol Navarro and her family, and Maria Ponce Navelino for
their kind hospitality and friendship. In Turkey, my sister, Merve Eren,
mobilized her friends and colleagues to obtain all relevant library mate-
rial written in Turkish. I also highly benefited from my discussions with
two colleagues in France and in the United States. My thanks, there-
fore, go to Dr. Severine Bellina at the Institut de recherche et debat
sur la gouvernance who offered me in-depth analyses of the French
approach to democratic governance, and Prof. G. Shabbir Cheema,
without whose help and understanding it would have been impossible
to complete this manuscript.
The entire staff at Palgrave Macmillan was a pleasure to work
with, offering helpful comments and graciously accepting last-minute
changes . In particular, I would like to thank Anthony Wahl, Emily
Hue, Farideh Koohi- Kamali, and the staff of Macmillan Publishing
PREFACE AND ACKNOWLEDGMENTS xvii
Solutions, particularly Sailendra Dewan, Matt Robison and Allison

McElgunn.
Finally, I am immeasurably indebted to my husband, Sebastien
Blind, and my son, Teohan Blind, who patiently waited for this project
to reach fruition while traveling around the world with me en route.
This book, however, is dedicated to the memory of my father, Seydi
Vakkas Kaleagasi, who lost his battle to cancer before seeing the book
materialized, and to my mother, Fatma Munevver Ozakman, who
made several trips between the United States and Turkey to take care
of our family during my long hours of absence.
Every man, wherever he goes, is encompassed by a cloud ofcomforting
institutions, which move with him like flies on a summer day.
Bertrand Russell (1872- 1970)
INTRODUCTION
P rivatizations are a standard feature of the transition toward a

market economy and the restructuring of state. They stand out
among the other components of structural adjustment reforms, such
as trade and capital account liberalization or tax reform, by their
direct and immediate impact on specific societal groups. The short-
term effects of privatizations are not general and dispersed on society
as a whole . A blue -collar worker dismissed as a result ofprivatizations,
for instance, will certainly feel the immediate effects of privatizations
much more so than a small-business owner or a white-collar profes-
sional, who will simply note privatizations on television news reports .
Privatization programs as such have direct, immediate, and strong
effects on blue-collar workers worldwide. These unique characteris-
tics of privatizations render their social and political consequences on
labor much more significant and readily observable .
Privatizations stand out in globalization also because they are
among the most widely used tools of economic development in the
developing world. Between 1980 and 1993, the number ofprivatiza-
tions increased in Asia from 108 to 367, in Africa from 210 to 254,
and in Latin America from 136 to 561. Over the same period, the
revenues governments obtained as proceeds from these privatizations
totaled $19 .7 billion in Asia, $3 .2 billion in Africa, and $55.1 billion
in Latin America (World Bank 1995, 27-28). Between 1997 and
2004, more than 4,000 privatization operations were carried out in
the world, bringing to governments a total revenue of over $1,350
billion (Bortolotti and Miella 2007) . There is thus no doubt that
2 DEMOCRATIC INSTITUTIONS
privatizations are important not only for their direct and immediate
effects on workers but also for their own sake.
Privatizations have such an important place in globalization that
they are often equated with structural adjustment plans as a whole by
citizens. In Latin America, for instance, the extensive surveys conducted
by Baker (200 1) found that privatization is sometimes the only policy
that Latin Americans could name as an example or component of the
structural adjustment plans. One might be surprised to know that
names ofpolitical leaders who undertook privatizations have come to be
identified with globalization itself. "Menem," "Menemism," "privatiza-
tions," and "globalization" are often used interchangeably in Argentina .
The picture is not dissimilar in Turkey: "Ozal," "privatizations," and
"globalization" are synonyms to most Turks.
Labor unions and workers constitute the most important secto r of
society immediately affected by privatizations.
• In what respects do privatizations affect labor unions and unionized

workers?
• How do the effects of these changes in post-privatization settings,
in turn, affect the ways unions interact with one another and
with other important actors, primarily government bureaucracies,
political parties, interest groups, and social movements?
• How do privatizations affect the attitudes and behavior of
unionized workers, including those who retain their jobs in the
newly privatized workplaces versus those who do not?
• How do these simultaneous transformation processes within the
body oflabor unions and the working class translate into the democ-
ratization process? In short, what is the nature of democratization
in globalization?
This book attempts to provide answers to these questions though

a study of the two "model students" of globalization: Turkey and
Argentina. Four intertwined lines of analysis make up the empiri-
cal skeleton : (1) examining the unions and the unionized workers
in the pre - and post-privatization periods; (2) studying the changes
spurred by privatizations in the labor unions' internal organization
as well as in their external interaction with the governing party or
coalition of parties; (3) examining the significant changes, if any, in
the political attitudes of current and former union members in the
face of globalization; and (4) comparing the two seemingly different
worlds from Eurasia and Latin America only to find that similarities
INTRODUCTION 3
in democratization patterns abound in globalization, that is to say

institutions democratize while individuals do not necessarily do so.
This study finds that while Turkish labor unions cooperate more
with each other and voice their support for the democratization of
state-society relations in the post-privatizations period, the apathy of
the masses increases in tandem. Workers who lose their jobs as result
of privatizations seldom increase their political participation, rarely
join social organizations, and at best, temporarily engage in collective
action to convey their discontent and seek their rights . The short-
lived Victims of Privatizations Movement in Turkey constituted an
important learning experience for Turkish democracy, but came to
an abrupt end due to dwindling trust and difficulties implied by col-
lective organization; lack of adequate financial resources and weak
political influence. In Argentina, partisan links seem to have weak-
ened and stateness appears to have increased as a result of a modified
set of union strategies with and after privatizations. In both countries,
while unions regroup and act, individual workers voice helplessness
and isolation in the face of globalization. How is it possible that insti-
tutions adapt to and embrace privatizations and globalization while
supporting democracy more overtly and avidly, whereas individuals
who constitute these institutions become more and more disgruntled
and marginalized? Are privatizations to blame?
Understanding the relationship between globalization and democ-
racy is complex . While this book attempts to simplify the analysis by
focusing on one of the most important tools of globalization and
narrows down the target population to the world oflabor, the task still
proves daunting. To gauge the extent and to understand the nature
of democratization in the global era, this book looks at the impact of
privatizations on the internal organization, external participation, and
structural configuration of labor institutions. The scope of analysis is
not limited to the institutional level. Ifstudying the metamorphosis of
labor institutions is relevant and important for the understanding of
democracy in globalization, so is the transformation in the democratic
attitudes and behavior of the individuals who make up these institu-
tions. Workers are thus brought into analysis to see whether their
participation levels in the system and their perception of democracy
have increased and improved, respectively, in any way after and due
to privatizations.
It is as important to enumerate the main contributions of a book
as it is to state what it does not entail. This book does not aim to
explain why some unions participated in privatizations while others
rejected them. Instead, it endeavors to understand the profound

changes that occurred in unions after privatizations in terms of their
internal organization and structure, their external participation pat -
terns in decision-making mechanisms, and the attitudes oftheir current
and former members vis-a-vis democracy. As such, the book focuses
on the shifting degree and nature of inclusion of unions and workers,
the multifarious political bargaining processes between the state and
labor unions, and the new social movements involving workers. This
book doe s not profess to offer groundbreaking explanations about
why privatizations are pernicious, or a panacea, for democratization.
Instead, it aims to tease out the complex nature of democratization
in the era of structural adjustments via changes detected in the roles
and activities of labor and the concomitant shifts in workers' behavior
and attitudes toward democracy. As such, this book will not give any
verdicts on the overall democratization of either Argentine or Turkish
politics, but will show tendencies and trends. Finally, this book is not
concerned with finding out what renders privatizations successful
or not. Victoria Murillo (1997) has established that labor's reaction
to privatizations is an important determinant of how successful the
latter will be in Latin America . Glen Biglaiser and Michelle Danis
(2002) have enlarged the scope of analysis to the develop ing world
for showing that privatizations are more likely to be successful in
democratic countries than in authoritarian regimes . This book inves-
tigates the reverse direction in this relationship, that is, the impact of
privatizations on democratization .'
To understand privatizations in practice and not only in theory, we
need to disentangle them into their different types and observe the
actual process of their implementation in different societies . To grasp
the complex nature of democratization in the era of globalization, in
turn, we need to disaggregate it into its specific components and note
how the actors mo st involved in the intersection of privatizations and
democratization adjust to changing circumstances. Labor unions as
institutions and workers as individuals stand at this intersection. The
world oflabor unions and workers, as such, offers a propitious ground
for studying the impact of privatizations on democratization.
On the basis of such theoretical grounding and empirical obser-
vations, this book attempts to provide a qualitative synopsis of the
social and political consequences of globalization in the developing
world. It does that through a thorough comparison of two most
different systems, Turkey and Argentina, which share no more than
their endemic economic crises as a common characteristic. The book
is organized around five main parts. The first chapter delineates the
INTRODUCTION 5
main concepts, working hypotheses, and methodology. It defines

privatizations, weaves them into globalization, clarifies the meaning
of democratization for purposes of this study, and links them with
labor. The second and third chapters offer insights on the simi-
larities and differences in the historical developmental patterns of
labor institutions and the evolution of working class in Turkey and
Argentina. The fourth and fifth chapters bring the analysis to our
days, attempting to outline the possible relationships between priva-
tizations and the observed social and political changes at the insti-
tutional and individual levels of analysis. New union strategies and
developments are illustrated in these chapters along with the personal
experiences ofTurkish and Argentine blue-collar workers affected and
not affected by privatizations. Finally, the sixth chapter synthesizes
the historical and the present only to deconstruct it later through a
juxtaposition of Kemalist with Peronist projects of state and nation
building, including the idea of stateness. The conclusion of this book
is, in this sense, only a new beginning in the quest for understanding
the counterintuitive finding of the overall analysis: labor institutions
open up, participate, innovate, and in a way, cautiously democratize
in Turkey and Argentina, while individual workers do not.
CHAPTER 1
A RECIPE FOR DECIPHERING

DEMOCRATIZATION TODAY
PRIVATIZATIONS AND LABOR
Globalization is the increasing interconnectedness of the world

through economic, political, and social ideas, institutions, and
exchanges . The dominant and unfettered role of state in the produc-
tion of goods and services does not belong to the globalized world.
Economic globalization entails the downgrading of state interven-
tions in economy through the privatization of state-owned sectors
and enterprises. Privatization, as the most significant and direct
tool for reducing the scope of state in the economic sphere, also
involves a restructuring of state -society relations. The new forms of
politics created and stimulated by privatization bring the possibility
of ''globalization from below"-social movements that seek to create
autonomous political structures from the grass roots up. Privatiza-
tion, in this regard, is not only the most political tool of economic
globalization but also its microcosm.
PRIVATIZATIONS
While globalization goes hand in hand with privatizations, there is no
single recipe for privatizations just as there is no unique understanding of
globalization. The myriad definitions ofprivatization range from a simple
transfer of assets from the public to the private sector to outright liber-
alization. With privatizations, the state abandons the economic sphere of
production by getting rid of the firms and functions under its control.
Table 1.1 Definitions of privatization
DEFINITION DEFINITION
RANGE DEFINITION SOURCE
Nar row Transfer of compan y assets from the Thomas Callaghy and
government as owner to a private secto r Ernest Wilson (1988)
receiver
Narrow Shifting into nongovernment hands some Marc Bendick (1989)
or all roles in producing a good or a
service that was once publicly produced
Narrow Transfer of assets and service functions Steve Hanke (1987 )
from public to private hands
Medium Reduction of the role of state in supplying Michael O'Higgins
good s and services to the population (1989)
Broad Process that shows every sign of reconsti- Paul Starr (1989)
tuting major institutional domain s of a
contemporary society
Broad Attempt to differentiate between public Alan Walker (1989 )
and private sources but also means of
striking a new balance between them
Broad Liberalization, deregulation Jacques Dinavo (1995)
To do that, the state may keep all of its equity and delegate manage-
ment of an enterprise to the private sector. It can also choose to sell all
or a portion of the enterprise's assets. Liberalization means the removal
of restrictions in entering a particular market. Liberalization breaks up
monopolies and increases competition in the marketplace.
The main definitions of privatization are summarized in table 1.1.
No matter which definition is chosen, privatizations entail a profound
transformation of the role of state and the balance between public
and private spheres . The same goes with globalization. This study
opts for a narrow definition of privatization as the total or partial sale
of assets of state-owned enterprises (SOEs) to the private sector. This
restricted perspective on privatizations is for purposes of parsimony,
but it also makes it easier to separate privatizations from the rest of
the structural adjustment reforms in terms of processes and impact. I
There are as many methods of privatization as definitions of
it. Direct sales or tenders to national or international businesses,
initial public offerings (IPOs), management or employee buy-outs
(Mj EBOs), employee-share ownership programs (ESOs), allocation
of shares to the public, debt-equity swaps, and liquidation of public
enterprises or sale of their assets are some of these methods (Nestor
and Nigon 1996, 12) . In general, many of these alternatives are used
in combination in the privatization of a big firm or a sector.
DECIPHERING DEMOCRATIZATION TODAY 9
Regardless of the variety of methods employed, privatizations may

have common goals that can be classified as economic or political.
The economic goals of privatizations include an increase in economic
efficiency through enhanced competition, an improvement in the
quality of goods and services provided, the expansion of consumer
choice, a recovery in the balance of payments and the national
budget, the promotion of foreign direct investment, and enhanced
technology. All of these forces can work to fuel economic growth.
As such, the implicit logic of privatizations is to solve the problems of
sluggish growth and inefficient SOEs, which constitute a substantial
drain on government finances in many developing countries.
Privatizations are inherently political. The political goals of priva-
tizations include a reduction in corruption through a cutting down
of state's role in supplying goods and services. An improvement
in the economic and political position of minority and/or ethnic
groups can also be targeted through privatizations. In Malaysia, for
instance, an obligatory allocation of 30 percent of shares in priva-
tized companies to members of the minority ethnic group Bumipu-
tras has redistributed wealth and income in society (Ghosh 2000, 11).
In Turkey, privatizations provided the stimulus for the effective use
of political Islam as a "language of social disadvantage" to reincor-
porate the unemployed into the labor market (Bugra 2002). As such,
Islamic values of social justice and equity were often contrasted with
the notion and practice of privatization by politicians and civil soci-
ety activists. In Argentina, the reknowned employee-share owner-
ship programs (Programas de propiedad participada, PPP) not only
were about obtaining workers' acquiescence to privatizations, but
also entailed their empowerment by making them owners of stocks
and shares in the firms in which they worked (Tomada et al. 1992).
Does the political agenda behind privatizations mean that they might
potentially shape and mold processes of democratization? And what
is democratization?
DEMOCRATIZATION
A careful analysisof the definitional map ofdemocracy shows that three
important categories have dominated political science literature. The
first comprises the "instrumentalist" definitions pioneered by Joseph
Schumpeter (1965), who defined democracy as a system in which
people, political parties, and interest groups pursue their interests
according to peaceful and rule-based competition (269) . The second is
the "culturalist" definitional category in which democracy is perceived
as a specific type of culture. Between the "minimalist-instrumentalist"
definition, which takes elections as the most important component of

a democracy, and the "ideational-culturalist" definition, in which the
norms and traditions of democracy replace elections as its core ele-
ment, there lies a third approach: the "institutionalist." This approach
endeavors to combine the useful elements of both the minimalist and
ideational schools . As such, the "institutional" definition of democracy
takes into account elections as well as institutions.
Institution building is democratization if the institutions are
or aspire to be democratic. Democratization, therefore, refers to
political changes toward more democratic institutions and political
regimes (Potter 1997, 3). It entails liberalization- but includes
more than just a relaxation of repression and the granting of cer-
tain freedoms (Whitehead 1991, 8-9) . According to Juan Linz and
Alfred Stepan (1996), democratization requires, first and foremost,
open contestation and free and competitive elections. According to
Guillermo O'Donnell and Philippe Schmitter (1986), it then takes
shape through a gradual application of the rules and procedures
of citizenship to political institutions previously governed by other
principles, such as coercive control or social tradition.
Some scholars advocate dividing the democratization process into
two specific, but interrelated, phases : transitional and consolidation.s
The former refers to the "time between the breakdown of a dictator-
ship and the conclusion of the first democratic national elections"
(Bermeo 1997, 305) . The latter denotes the lengthy and difficult pro-
cess whereby democratic structures and norms are accepted as legiti-
mate, partly or entirely, by civil society and by the political elite . In
this dichotomous view, democratization is conceived as being mainly
a game played by and among the elite. Elite settlements or pacts
prompt processes of reconciliation and launch a series of procedural
arrangements whereby functions and status in the next regime are
negotiated and bargained away (Przeworski and Wallerstein 1982).
Elite convergence, as such, stimulates the transition to democracy,
which then takes on the difficult and gradual task of consolidating
the institutions.
This study adopts the middle-ground institutionalist perspective
on democratization, which it conceives as a continuous and gradual
process. Therefore, democratization is not seen as suddenly started by
elections alone or as driven only by elite settlements. Frances Hagopian
(1990) has shown how elite negotiations have ended up in the resto-
ration of authoritarian ties between the civilian and military elites of
the old regimes in Brazil, Peru, South Korea, and the Philippines.
Similarly, the plethora of political systems with free and fair elections
but without the necessary and well-function ing systems of political

and civil rights shows that elections are not equal to democratization
(Kaplan 1997; Zakaria 1997).
In a continuous understanding of democratization, it is essential
to detect processes of collective action, social mobilization, and insti-
tutionalization over time so that a fuller account of democratization
can be obtained (Collier and Adcock 1999; Collier and Mahoney
1997). In this regard, labor constitutes an especially interesting arena
for the study of democratization from an institutionalist perspective
since it embodies par excellence both the collective action and social
mobilization variables while providing an important institutional link
between the masses and the political elite. In this vein, social move-
ments and associationalism, mass uprisings, and worker mobilizations
become central to the study and understanding of electoral democra-
cies (Snow and Manzetti 1993).
LABOR: LINKING PRIVATIZATIONS AND

DEMOCRATIZATION
Labor is important in and for democratization. Historically, labor
unions and workers have been active in democratization move-
ments in different parts of the world. It was, for instance, the
general strike of 1977 in Portugal that led the government to set
up a constituent assembly, thereby precipitating the transition to
democracy. In Spain, organized labor's demands concerning union
democracy soon escalated into demands for political liberties for
the people at large, ultimately causing the end of Franco's regime.
In Argentina, labor protests and working-class resistance intensi-
fied divisions within the military, thereby instigating a process of
political opening (apertura) in the 1980s (Collier and Mahoney
1997, 289 , 91).4 When the military closed down the legislature
in Uruguay in 1973, workers were the only social group that pro-
tested publicly (298) . Even in Turkey, a nation with no historical
experience of democracy before the 1950s, labor took an anti-coup
stand against rumors of a possible military takeover in the face of
rising Islam ism in 1997.
Labor unions and workers, in addition to being important actors
in democratization, are also the groups most intensely and directly
affected by privatizations (Cook and Murphy 2002, 1) . Privatizations
have effects on wages, job security, working conditions, employment
levels and conditions, the internal organization of unions and their
relations with one another, unions' strategies, the type and extent of
labor movements and protests, and finally, the very idea of unionism.
While many scholars argue that privatizations result in layoffs and
increased unemployment (Odekon 1998), others maintain that priva-
tizations have actually increased employment. David Fretwell (2002)
argues, for instance, that employment increased by 10 percent in the
ten Chilean SOEs privatized between 1985 and 1990. Murillo (2002)
uses the same example to argue for the opposite. She maintains that
even though employment increased following privatizations in Chile,
the unemployment rate was still a considerable 10 percent in 2000.
Despite disagreements regarding the impact of privatizations on
employment levels in the long term, there is a general consensus
on their ramifications on union membership . The consensus is
that privatizations decrease union membership, thereby rendering
unions weaker and politically less powerful. These critical condi-
tions may push unions to look for alternative strategies of survival
and participate more actively in decision making in the global age.
The same is valid for workers who make up the unions. It might
very well be that privatizations provide the stimulus to transform
workers from passive names on union lists into active participants of
social movements, thereby rendering their exclusion from the politi-
cal system more and more problematic. As a result of the changing
rules of the institutional game and citizens' reactions, governments
can then feel more prone to reform toward promoting new and
effective sociopolitical inclusion processes . Seen from this perspec -
tive, privatizations can trigger a whole chain of action-reaction in
state -society relations, which would then significantly affect the
democratization process .
There are many other possible ways in which privatizations can
influence democratization through the changes in the world of labor.
Economic development changes class structure, enlarges the working
and middle classes, and facilitates their self-organization, thereby ren-
dering their exclusion more and more difficult, according to Evelyne
Huber Stephens, Dietrich Rueschemeyer, and John Stephens (1993,
14) . Although privatizations are engines of economic change for
better or worse, political scientists rarely study those who are most
affected by them-workers. Murillo (2001), for instance, omitted
workers from her study of government-union relations arguing that it
is the union leaders, and not the workers, who participate directly in
decision-making processes. A focus on democratization would neces-
sitate bringing in the worker s because not only are workers important
collective actors in democratization, but also democratization itself is
a process of organizing and mobilizing the masses.
Workers and the modes and modalities in which they have coped
in and with globalization are relevant for the study of democratiza-
tion . The post-privatizations period in different parts of the world
has shown that the rank and file can organize and mobilize without
the approval of union leaders. In India and Russia, for instance, the
inability of union leaders to protect jobs and incomes has prompted
individual workers to rely on informal bargains struck with their
firms or communities (Candland and Sil 2001, 305). In Argentina,
"worker councils" comprising delegates of the rank and file in indi-
vidual plants have continued their activity throughout the consecutive
military regimes (Natalicchio 2005) . Considering these precedents,
one would expect the workers touched by privatizations to take
action, including joining or even founding their own social organiza-
tions or movements.
New organizations and avenues for participation in which citizens
have been active in the developing world are many: popular consulta-
tion (consulta popular)5 popular assemblies (asambleas barriales)6
anti-globalist or anti-capitalist groups such as The Association for a
Fee on the Speculative Financial Transactions and for Aid to Citizens
(La Asociaci6n por una Tasa a las Transacciones Financieras y Ayuda
a los Ciudadanos, ATTAC),7 Dialogue 2000 (Dialogo 2000)8 and
the Committee of Mobilization for the World Social Forum (Comite
de Mobilizacion para el Forum Social Mundial, CFSM),9 and societal
groupings such as neighborhood associations, picketers (piqueteros),
human rights organizations linked to leftist parties, and opposi-
tional movements by the center-right are only some (Gambina and
Campione 2003, 154). These new forms of association and repre-
sentation might constitute new modes and practices of democracy in
the developing world . Yet, one wonders whether they are related to
privatizations in any way or degree .
Privatizations concern workers not only because of the implicit and
explicit threats of unemployment and relocation, but also because
they may encompass social programs such as temporary income sup-
port, active training programs, special assistance programs, direct
dialogue between the government, enterprise management, workers,
and community leaders, and other social support packages and labor
redeployment services. Such social programs linked to privatizations
may provide transitional income support until displaced workers find
alternative sources of employment. They may also assist such workers
in finding other jobs by providing psychological support in the search
process. If successful, these programs can have political ramifications,
including an impact on democratization. The question is whether
social programs included in and associated with privatizations have

been effective in meeting their stated objectives .
Labor is an actor in both privatizations and democratization
because it is the target group of "labor capitalism." This universally
used term implies and includes the M/EBO and ESO components of
privatization programs. The M/EBOs allow workers to set up invest-
ment companies and to borrow from banks in order to participate in
the privatizations of the SOEs they are working for. This is a tech-
nique most suited for medium-sized firms that require less capital.
The ESO programs, on the other hand, consist of a legally fixed
percentage of shares to be sold to the employees of a company at
discounted prices.
Labor capitalism may enhance the role of unions by making them
active participants in privatizations. It may make them more business-
and policy-oriented. Unions may thus become equal partners of
business and government in negotiations. Workers, likewise, may
become shareholders. They may acquire a more direct stake in how
well their firm is doing and, as such, take greater interest in economic
and political developments in general. This renewed interest may lead
them to participate more actively in sociopolitical decision making.
Such developments can potentially improve labor relations with the
government and the private sector (Gates and Saghir 1995). Has this
been the case?
Labor constitutes a fertile terrain for gauging globalization's impact
on processes of democratization because it disposes of important
democratic tools such as protest marches, strikes, sit-ins, lockouts,
and collective bargaining, all of which can be galvanized by privatiza-
tions . Tables 1.2 and 1.3 show the global trends in labor activity from
2001 to 2002. Although privatizations and other economic reforms
spurred by globalization have ended up in unemployment and
Table 1.2 Workers involved in labor activity
(in thousands), 2001-2002
Number of countries covered

Regions
2001 2002
Africa 10 13
America 22 23
Asia 15 17
Europe 30 32
Oceania 2 2
Total 79 87
D E CIPH ERING DEMO CR ATIZATIO N TODAY 15
Table 1.3 Working days lost due to labor activity,

2001-2002
Number of countries covered

Regions
2001 2002
Africa 10 13
America 28 28
Asia 15 17
Europe 29 31
Oceania 2 2
Tot al 84 91
Source: ILO Yearbook of Labor Statistics, 2001 and 2002 .
deunionization, these tables show that, at the peak of privatizations

in the beginning of th e twentieth century, the number of workers
involved in protest movements increased, as did the total number of
days spent without work due to labor conflicts. Yet, with time, worker
mobilization seems to have dwindled. The total number of working
days lost due to strikes and lockouts decreased in the world from 441
in 1996 to 35 in 2004.10 Strikes have also decreased by a factor often
since 1979 (Addison and Schnabel 2003) .
Although strike statistics are useful in terms of giving us the larger
picture and trends in organ izational activity spurred by globaliza-
tion, they do not tell us what causes the strike waves, nor do they
convey country-specific information. As seen in figures 1.1 and 1.2,
while strikes initially increased in Argentina following the advent of
privatizations, the trend has been downward and low except for sho rt
peaks coinciding with economic crises. In Turkey, on the other hand,
strike patterns have stayed relatively constant except for minor surges
in 1999-2000 and 2003-2005, as seen in figure 1.3 . What has the
role of privatizations been in the changing patterns of strike activity
in Turkey and Argentina? Do privatizations make workers more
active memb ers of their unions and communities or do the y end up
in increased apathy?II
Strikes are one social facet ofglobalization kindled by privatizations.
Globalization also change s the way unions interact with political
parties. Privatization s can again act as a catalyst in this metamorphosis
by mitigating what one can call the "partisan links." Defined as tra-
ditional links of populist pedigree, partisan links between unions
and political partie s make it less likely for labor to communicate
with political actors other than the preferred party. A decrease in
partisan links injects pluralism into the clientelistic partisan links.
16 D E M O CR ATI C I N S TI TU T I O N S
1000
It..
900
/ \ ~
en 800
~ 700
.;:
---;::;; v \
iii 600 7 \
'0 500 / '\
7 '\ ~
.
~ 400 V': /-.
§ 300 \ /\ A
z 200 \ I ~ \ ~
100
V ~
o
1980 1985 1990 1995 2000
Source: Cen tro de Esnidios Nueva Mayoria (Palomino and Senen , 2(03) cited in
Cardoso (2004. 43) .
Figure 1. 1 Trends oflabor conflicts (strikes) in Argentina (1980 -2002).
180 ~-----------------------
160 -1-- - - - - - - - - - - - - - - - ------1-'1------ - - -
140 -1-- - - - - - - - - + -- - --/+-- - --+-+-- - - -
120 ...J.----------I-+---,-+\---+.=--+~--
100 -1-------------..---I---\--+\--I-~~-----,I---4~~'=_--
80 ...J.---------.c*-+--+~f_____'~-\J.--.,.,._\_-I---. ~.__:~-
60 -H~>____a..__.1L-----..-\-A_+=-_+_~IIr- +-~_I'ri----~.._\._____
40 ~t=.....d,_=-c---...-l--=--~--____\rl'--------------lI1--
20 -1-- - - - - - - - - - - - - - - - -- - - - - - -
O-l----~----~---~~---~----~-
January- August-03 March-04 September April-OS October
03 -04 -05
I-+- Strikes - - Other I

Source : Documents of Argentine Ministry of Labor prepared in cooperation with the
Independent Social Science Consultation Center (2006).
Figure 1.2 Trends of labor conflicts (strikes and other protest actions) in Argentina
(2003-2005 ).
Christopher Candland (2001) argues th at partisanship renders unions

excessively depende nt on party rivalries, causing what is called "invo-
lut ed pluralism." Defined as an excessive multiplicity of unions,
involuted pluralism paves th e way for management and party leaders
to exploit labor (Rudolph and Rudolph 1987,259-89 ). As a result,
labor union leaders with partisan links to parties tend to be mo re
corru pt, conservative, and auto cratic (ibid ., 86) . This is in stark con -
trast to cases in which the absence of partisan links works to bring
60 , . . - - - - - - - - - - - - - - - - - - - - - - - - -
50 +-----------rr-~-----------
Ul 40 t--~8t::vi~-----"''''''~~----->.,~=_--------
.--+34
~30+-----------=-.:.----~~-.,.,.-----"l..,,==-----='--'---
30
u; 20 +-----------------~"'---------
10 +-- - - - - - - - - - - - - - - - - - - - - - -
0+----...-------.------.------.-------.---
1995 1997 1999 2001 2003 2005
Years
Source: Based on statistics published by Turki sh Ministry of Labor and Social Security
hup .z/www.calisma.gov tr/istatistiklcgmlyillarJesmi-llrev.htrn
Figure 1.3 Trend s of/abor conflicts (strikes) in Turkey (1996-2005 ).
closer cooperation between unions and nongovernmental organiza-

tions . Accordingly, unions without their political patrons by their
side seek new allies, engaging in more participation, negotiation, and
research .
A change in the relationship between unions, political parties, and
eventually the state can have consequences on the internal function-
ing of unions as well. A decrease in partisan links might lead these
unions to implement gradual changes in their election procedures
toward more competitiveness in the selection oflabor repre sentatives .
Many labor unions in the developing world are well known for the
lack of turnover in their top leadership positions. Once a leader gets
to the top of a confederation, federation or union, he often occupies
that post until his death. Privatizations, by damaging the patron-
client ties between government and union representatives, might
facilitate a more democratic internal reorganization of unions in the
post-privatizations period (Fiorito, [arley, and Delaney 1995, 618).
The internal organization of unions is important for democ-
ratization since "genuinely democratic and outwardly connected
unions bring substantial benefits to workers and their organization"
(Candland 2001, 129). How labor union leaders are selected is
an important measure of unions' internal democracy. Accordingly,
the secret ballot election of union leaders increases the confidence
of the rank and file that its preferences count in negotiations of col-
lective bargaining. Elections within unions also reduce the ability
of political parties to penetrate and fragment the labor movement.
Finally, union elections expand the social ties within the "labor-
popular milieu," composed of the rank and file, nongovernmental
organizations, and representatives inside and outside the workplace
who claim to speak on behalf of workers . Unions' collaboration with

various civil society actors, including former union members and
the unemployed, provide examples of some of the new alliances and
forms of democratic participation in the post-privatizations period.
Privatizations may also increase the social ties within labor and
between labor and other social actors. The strengthening of social
ties as a result of privatizations might create what Bert Klandermans
(1990) calls an "alliance system"-the more decentralized and infor-
mal way in which labor and management are connected to each other.
Candland and Rudra Sil (2001) observe that the 1990s witnessed the
emergence of what they call "new unionism." Defined as a process of
increased cooperation and interaction between unions and other social
organizations, new unionism also implies deeper roots by these institu-
tions within their local communities, that is, an alliance system (20).
Are alliance systems and traits of new unionism present in post-
privatization Argentina and Turkey? Are the posited links between
privatizations and democratization observable and present in the real
world? To find the answers to these questions, one has to analyze
(i) the political conflicts over privatizations and their effects on the
organizational adjustments within both the overall union structures
and individual unions; (ii) the shifts in the type and intensity of
unions' dealings with the political elite, including the political par-
ties and the state ; and (iii) the changes in the nature and degree of
unions' cooperation with civil society organizations and social move-
ments. Studying labor institutions not only helps us appreciate how
legacies of existing institutions shape privatizations, but also reveals
how new legacies themselves are created by processes of privatiza-
tions. As Thomas Carothers (2002) writes, "Democracy promoters
need to take a serious interest in privatizations to make a credible case
to economists that they should have a place at the table when such
programs are being planned" (19). One way to do that is to look at
how unions as institutions and workers as individuals respond to the
challenges posed by privatizations.
METHODOLOGY
To study the nature of democratization in globalization, intensive,
in-depth interviews with labor union leaders, civil society represen-
tatives, and politicians responsible for privatizations in Turkey and
Argentina were undertaken in 2003, 2005, and 2006. In addition, a
total of 15 focus groups, composed of about 30 blue-collar workers
in Turkey and 50 in Argentina, were carried out.P The workers came
from different educational, geographical, socioeconomic, and political

backgrounds and were affiliated with the main labor confederations in
both countries. They were thus chosen nonrandomly and principally
through networking with labor specialists, civil society activists, and
workers, and most of the time after long waits and arduous convincing
in front of workplaces and unions.
The reasons for the use of a nonrandom sample were manifold.
First, in this specific case, it was impossible to draw on random
sampling, since some unions did not want to share the lists of their
members, nor did they all have access to workers who lost their union
memberships as a result of privatizations. Second, the qualitative
strategy of controlled sampling, that is, the selection of respondents
on the basis of the dependent variable oflabor, was appropriate for the
nature of the research question at hand. It was so because I expected
the responses of workers to privatizations to be strongly correlated
with their labor confederation affiliation, given that both union affili-
ation and political attitudes are strongly determined by political and
ideological predispositions in both Turkey and Argentina. It was
therefore in the best interest of this study to include as much causal
heterogeneity as possible into the sample with respect to sector and
union affiliation.P Random sampling, even if it were possible, would
in fact have been problematic in this case: "In small-N studies," David
Collier and James Mahoney (1996) write, "random sampling may
produce more problems than it solves. The alternative approach of
nonrandom sampling can be used in such cases" (20).
While selection bias can be a problem when the sample size is small
and a qualitative selection strategy is required, it must also be acknowl-
edged that other interesting details are better grasped by the use of
focus groups. While random sampling would have provided results
that would be more easily generalizable to the whole population of
Turkish and Argentine workers, generalizability comes at the expense
of parsimony, accuracy, and causality (Przeworski and Teune 1970).
Controlled sampling, on the other hand, allows the setting up of a
carefully contextualized and conceptually valid analysis of a few cases
of the outcome. As Ronald Rogowski (1995) maintains, "Some of the
most influential studies in comparative politics have managed to pro-
duce valuable findings even though they violate norms of case selection
proposed by the quantitative literature on selection bias" (468-70). Ex
post facto, I should also confess that it would have been utterly hard, if
not impossible, to convince tired and sometimes half-illiterate workers
to fill out extensive survey questionnaires about their experiences and
views on as abstract and multidimensional concepts as democracy.
FINDINGS
Results of the fieldwork show that privatizations create convergent
institutional changes across different cultures, but they produce
divergent individual responses from workers. Privatizations cause or
reinforce similar divisions within the labor union structure in Turkey
and Argentina with comparable changes in the relations unions have
with interest groups, civil society organizations, political parties,
and the government. They, however, produce disparate responses
from the rank and file: while Turkish workers affected by privatiza-
tions choose to mobilize to obtain some kind of restitution from the
state, Argentine workers do not attempt to contest privatizations by
forming a grassroots movement independent of the union structure .
That said, the Turkish grassroots mobilization dwindles in time and
the movement peters out as participants of the movement obtain jobs
in the formal market.
This finding is intrinsically important since many political econo-
mists have argued that privatizations, by being standard recipes for
shrinking an overarching and inefficient state, produce similar socio-
political consequences in different countries implementing thern.l!
An equally important number of scholars of political science, on the
other hand, have adopted a sociological neoinstitutionalistl'' or even
a culturalist perspective to argue that privatizations produce divergent
results depending on the specific country undertaking them.!" This
book demonstrates that both of these arguments are unsubstantiated.
Privatizations do not produce the same results in different countries
applying them, nor do they produce completely divergent results
depending on the country and contextual factors .
A systematic comparison of Turkey and Argentina also shows that
privatizations seem to produce highly similar changes in institutions
and the ways in which they try to adapt to the shifting social and
political parameters stimulated by privatizations. The convergent
effects of privatizations on institutions do not appear at the individual
level, however. In the short term, individual workers react differently
to privatizations in different parts of the world. In the long term,
however, collective action by individual workers and their temporarily
increased political participation, if any, subside.
Convergence at the Institutions: Signs of Democratization

The convergent institutional changes to which privatizations have
contributed their fair share in both Turkey and Argentina are threefold:
structural changes in labor systems, changes in unions' external
relations with nonunion actors, and minor changes in unions' internal

organization.
Structure of Unions: Triad Fragmentation and

Gradual Collaboration
A study of the Turkish and Argentine labor institutions since the
beginning of the privatization programs in the mid-1980s shows
that privatizations have led to similar structural divisions deter-
mined by the distinct responses and reactions of groups of unions
toward privatizations. This has been the case whether or not the
union structure in question was already divided by political ideolo-
gies or other factors in the pre-privatizations period. In Turkey, for
instance, where the labor movement was compartmentalized along
ideological lines into three major labor confederations, each one of
the confederations and their affiliated unions took separate and dis-
tinct attitudes toward privatizations. The Confederation of Turkish
Trade Unions (Turkiye Isci Sendikalari Konjederasyonu, TURK-IS),
as the largest labor confederation in the public sector and the labor
institution most directly affected by privatizations, chose to support
privatizations implicitly by astutely modifying its previous partisan
links with the governing parties. The left-leaning Revolutionary
Labor Unions Confederation of Turkey (Turkiye Devrimci Isci
Sendikalari Konfederasyonu, DISK), barred from organizing in
the public sector because of its revolutionary stigma dating back
to its intense involvement in the popular uprisings of the 1970s,
opted for a strongly anti-privatizations stand. The right-leaning and
relatively younger Confederation of Turkish Just Workers Union
(Hak Isci Sendikalari Konfederasyonu, HAK- IS), on the other hand,
adopted a clearly pro-privatizations stance, actively supporting and
participating in privatizations. While each one of the three labor
confederations adopted a pro-democratic political rhetoric, DISK
was the most active in reaching out to the civil society and overtly
supporting democratization.
In Argentina, although only one labor confederation is legally
recognized by the state, there too, the labor union structure split
into three separate branches with distinct responses and reactions
to privatizations. The legally recognized and the largest labor con-
federation, General Confederation of Labor (Confederacion General
del Trabajo, CGT) broke up into the pro-privatizations CGT-San
Martin, the anti-privatizations CGT-Azopardo, and a third group
of unions that declared themselves independent in the beginning of
the 1990s. The left-leaning CGT-Azopardo left the CGT in 1992 to
form an independent labor confederation without the state's legal

endorsement or personeria gremial. The former CGT-Azopardo,
today's Center of Argentine Workers ( Central de los Trabajadores
At;gentinos) CTA), openly and strongly contested privatizations while
pressing for the democratization of both the Argentine labor move-
ment and the political system.
As opposed to the CTA, the strongly Peronist CGT-San Martin con-
tinued its support of the privatizing Peronist Party and its leader, Carlos
Menem, in exchange for political appointments and privileged relations
with the executive during privatizations. Although one other group
of Peronist unions, organized under the banner of Argentine Workers
Movement (Movimiento de los Trabajadores At;gentinos) MTA), initially
opposed privatizations, this group never envisaged leaving the CGT-San
Martin. In fact, the MTA dissolved itself as soon as its popular leader,
Hugo Moyano, was elected to lead the CGT as its secretary-general.
A large group of previously independent unions representing well-
paid workers in the public sector switched to what might be dubbed
as business unionism, thereby actively supporting and participating
in privatizations. Finally, more recently, Argentina also witnessed the
formation of a strongly ideological movement of the rank and file
with more direct and loose links to retired workers and the unem-
ployed . The Class-Conscious and Combative Current (La Corriente
Clasista y Combative, CCC) is a loose association of union represen-
tatives, rank and file, the unemployed, picketers, and retired workers
subscribing to an assortment of leftist ideologies across Argentina.
The CCC works in close cooperation with the CTA and is increas-
ingly perceived and categorized as a separate labor confederation by
Argentine scholars (Gonzalez 2001) .
At a glance, there are similarities with respect to the positions
adopted toward privatizations and the resulting compartmentaliza-
tion of the union structures in Turkey and Argentina. Privatizations
converted some unions into business unions, such as the CGT-
affiliated and previously independent unions in Argentina and the
HAK-IS in Turkey. More traditional and official labor unions usually
devised strategies on the basis of their historically partisan ties with
given political parties or the state to become clientelistic unions as
exemplified in the cases of the CGT-San Martin in Argentina and
the TURK- IS in Turkey. Finally, privatizations transformed the reac-
tionary labor unions into civic unions as demonstrated in the cases
of the CTA in Argentina and the DISK in Turkey. Business unions
used privatizations to acquire firms and businesses, clientelistic
unions used privatizations to retain and obtain economic and

political privileges, and civic unions used privatizations to become
watchdog organizations on government for the implementation of
social reforms .
These divisions in labor did not prevent a gradual and cautious
trend toward cooperation. In Turkey and Argentina, civil society
initiatives were undertaken by a cooperative action of union confed-
erations and individual labor unions in collaboration with other civil
society organizations. The initiatives in question involved privatiza-
tions directly and explicitly in their formation rationale, as seen in
the Platform of Retired Workers (Emekliler Platformu) in Turkey
and the Argentine Confederation of the Workers of Privatized
Enterprises (Confederacion Argentina de Trabajadores de Empresas
Privatizadas, CATEP). Both organizations were founded by the
collaborative efforts of several branches of the union movements
in their respective countries to encourage debate and research on
both privatizations and democracy. Although short lived, such initia-
tives constituted important learning experiences for labor unions in
Turkey and Argentina.
External Role of Unions: Government- Union Relations

and Stateness
Privatizations increased government-union negotiations, more so
in corporatist Argentina than in Turkey, where unions are not the
traditional interlocutors of the state . Sebastian Etchemendy (2001),
in investigating the patronage networks between the privatizing
Argentine governments and their clients, including the labor unions
and business organizations, contemplates the processes of coalition
building and allocation of sectoral payoffs in privatizations. He
shows that Menem's Peronist administration favored the pro-privati-
zation unions in Argentina by according them the right to continue
their oversight of the social security system for their members and to
expand it to the whole citizenry. In Turkey, depending on the ideo-
logical stand of the political party or coalition of parties in power,
different labor confederations had dissimilar degrees of access to
the state and its resources. Pro-Islamic HAK-IS, for instance, had
extensive encounters and intensive dialogues with the privatizing
and equally pro- Islamic government of the Justice and Development
Party (Adalet ve Kalkinma Partisi, AKP) . In contrast, the leftist
DISK and the anti-privatization unions within TURK-IS had a much
closer dialogue with the representatives of social democratic parties
in the Turkish political matrix, such as the Republican People's Party

(Cumhuriyet Halk Partisi, CHP) and the Democratic Left Party
(Demokratik Sol Parti, DSP).
While partisan links have thus continued in the privatization and
post-privatization periods, the considerable weakening of such ties is
apparent in Turkey and Argentina. A close analysis of the relationship
between the state and the labor unions shows that privatizations have
contributed to the mitigation of patron-client nexuses between union
leaders and government representatives adhering to different political
tenets by simply giving patron-client links visibility. Such exposure has
intensified the public's discontent with corrupt behavior of political
and labor representatives . As a result, there are clear signs that state-
ness has increased in both countries.
Stateness refers to the "capacity of the state to specify the terms
of economic interaction, to extract resources , and to centralize
administrative procedures and coercive means" (Schamis 2002, 192).
As such, it is intrinsically related to the capacity of the state to take
the ultimate decision (Bakir and Onis 2007) . It is also more than that.
In stateness, the state also has the autonomy to plan, negotiate, and
act. Privatizations have given the upper hand to the state in deciding
the rules and the context of the game, even if this means that union
leaders could participate in and be active players of privatizations,
whether for or against them.
Stateness is a critical variable in determining whether or not a
given country can benefit from a global economy. It is also intrin-
sically and strongly related to democratization. Hector Schamis
(2002) affirms that in the absence of stateness, democracy collapses
(194). This corroborates Linz and Stepan's (1996) dictum that
"modern democratic governance is inevitably linked to stateness"
(27) . Privatizations, by remolding the nature of the relationship
between the leaders of union movements and their political patrons
in the government, have contributed to the formation of a "compe-
tent state ." The competent state is one that aspires to "steer rather
than row." Such a state ensures that services are provided effectively
rather than delivering them itself. The competent state is also com-
munity empowering: it encourages local groups to solve their own
problems rather than dictating bureaucratic solutions (Rondinelli
and Cheema 2003, 246) . It strives to use privatizations to interlink
the effectiveness of the government with the efficiency of markets
while pursuing the collaboration of all actors, (Cheema 2005, 152)
including that of labor.
Unions) Internal Organization: Internal Union Democracy

The internal organization and functioning of labor unions remains
a mystery in political science literature . Although most of the
unions in the developing world publish pamphlets and booklets that
explain their bylaws and the ways in which they function internally,
the implementation of these rules might not always conform with
what is written either in their own publications or in the national
Constitution. Theoretically, union elections could result in the
selection of the same group of people over and over again because
of the advantage of incumbency. All the same, suspicions of elec-
toral fraud in un ion elections are widespread, both in Turkey and
Argentina.
This study failed to detect any significant effects of privatizations
on the internal organization of unions in Turkey or Argentina. Several
union leaders and the diverse groups of the rank and file interviewed
for this study all affirmed that the election procedures had not under-
gone any changes whatsoever since or due to privatizations, nor did
they perceive any such changes in how election s were conducted.
This was the case regardle ss of whether the internal organization was
perceived to be undemocratic or democratic at the start. In Turkey,
for instance, workers consistently pointed to the lack of turnover
as the major reason for the perceived lack of democracy in unions'
internal organization. In Argentina, despite the same lack of turnover
in top leadership positions, unions' internal organization was deemed
to be essentially democratic by a majority of the respondents. The
main justification offered by the Argentine rank and file was that the
first-level union elections, for shop representatives, were generally
free and fair. In neither Turkey nor Argentina, however, did workers
perceive any effect of privatizations on the internal democratization
of unions.
The finding that privatizations do not seem to have any perceived
effects on the internal organization of labor unions is intrinsically
important. This is because it goes against the idea that privatizations
might enhance unions' internal democracy by the spillover effects of
the decrease in partisan links between representatives of the unions
and the government. The fact that no such change has taken place
might be explained by the learning effect: it takes time for actors to
learn to react to new conditions brought about by privatizations.' ?
This explanation is buttressed when one considers the rise of a new
type of union leader at the local level of union representation in
Argentina. As a general observation, the more a union was involved
26 DEMOCRATIC INSTITUTIO N S
in privatizations, the more salient was the change in the attitude and
behavior of the local union leader interviewed.
In Argentina, local union leaders in the post-privatizations period
tend to be younger, more educated, less politicized, and more prag-
matic than national union leaders . Local union leaders are also more
ambitious, pursuing higher education simultaneously, and are familiar
with financial markets and their ups and downs. The leaders of the
Union of Metallurgical Workers (Union de los Obreros Metalurgicos,
UOM) in San Nicolas, Gran Buenos Aires, explained this obvious
but gradual transformation of the profile of local union leaders by the
indispensable necessity to "catch up" with the class of employers: if
they, the union representatives, learned the "employers' language,"
the chances were that they could draft more effective and successful
collective agreements.J" Lawyers working for various labor unions
and labor politicians corroborated the same trends in the UOM of
San Quilmes and in several other Argentine un ions at the local level.19
In Turkey, the same "thirst for professional unionism" was clearly
present among local union leaders . The Bursa branch representative
of DISK-affiliated Union of Metallurgy Workers (Birlesik Metal, BM),
for instance, forged ties with the union representatives of the fac-
tory in Germany where the same private company as the new private
owner of the Bursa plant operated. As such, better conditions were
obtained in plant-level negotiations with the new employer, during
and after privatizations.l''
The new union leaders with a new identity and view of the world
emerge from the bottom in Turkey and Argentina . Such leaders prefer
negotiation rather than rebellion as the main tool for dealing with the
private sector and the privatizing government. Privatizations play an
important role in the emergence and evolution of these leaders since
they compel them to learn about the management of ESOs-ways to
protect their shares and make a profit from them while keeping their
worker identity so that membership levels can stay steady or increase.
Such union leaders also influence other union representatives who con-
test privatizations. The latter intransigent union leaders, in turn, become
effective lobbyists, who combine the power of persuasion, social mobili-
zation, and research to negotiate and bring about social reforms.
It is no surprise that this gradual change in the identity of
union leaders starts from the bottom and at the local level of
union representation . This is so because union leaders at the head
of confederations and federations are usually perceived as having
enriched themselves personally and illegitimately from privatizations.
DECIPHERING DEMO CRATIZATION TODAY 27
Since the very same privatizations caused unemployment, workers

and the society as a whole tend to view the top union leaders as the
corrupt political allies of an equally corrupt government carrying
out fraudulent privatizations. The so-called Gordos in Argentina-!
and the TURK-IS leadership in Turkey have often been stigmatized
as practicing "yellow unionism."22 Therefore, as the rank and file
becomes more and more discontented with the ways privatizations
are handled by the top leaders, the path is paved for the emergence
of the new breed of local leaders .
The convergent institutional changes that privatizations have created
in Turkey and Argentina do not mean that these two countries have
responded similarly to privatizations . On the contrary, the historical
legacies of state and labor institutions have greatly influenced the
individual attitude of workers in the face of privatizations. As a result,
Argentine workers have reacted to privatizations in distinct ways than
their Turkish counterparts, and vice versa.
Divergence of Individual Responses: Apathy and

Feelings of Isolation
Even though institutions have chosen to adapt to privatizations
in highly similar ways in Turkey and Argentina, individual citizens
directly affected by privatizations have done so in quite different
ways. Focus groups conducted with Turkish and Argentine blue-
collar workers who lost their jobs as result of privatizations have
demonstrated that privatizations do not have a considerable impact
on the political standing and activity of workers, although they may
ultimately exert negative effects on their political participation. The
same finding came out of focus groups conducted with workers who
retained their jobs after privatizations and those who were relocated
after staying unemployed for a while. Workers' political participation
in both Turkey and Argentina was instead shaped by a combination
of political ideology, rational calculations of expected benefits, and
prior civic involvement. In Turkey, more educated, previously active
and partisan workers continued to be politically active and mobilized
against privatizations. In Argentina, workers previously active in
their respective unions were shielded off from the negative effects
of privatizations such as downsizing. Most workers in both Turkey
and Argentina, however, chose to secure a severance package with as
many potential benefits as possible from the new private owner, who
typically wanted to downsize.
The closer a worker was to retirement, the higher was his propensity
to try to get the highest short-term monetary compensation and leave
the SOE, regardlessofthe risk ofnot being able to find another job after-
ward. This was valid for both Argentine and Turkish workers affected
by privatizations. For workers who were younger, better educated,
civic minded, and socially and politically active, things were different
in Turkey, but not so much in Argentina. A vibrant anti-privatizations
grouping called the "Movement of the Victims of Privatization" came
into being as soon as the first massive dismissals took place in 2000
with the privatization of the national Petroleum Company (Petrol Ojisi,
PO) in Turkey. The rank and file, seeing that union administrators were
either uninterested in or incapable of fighting for workers' rights, got
together and formed a national protest movement. Protest marches and
recurrent gatherings in front of government buildings and union head-
quarters were some of the widely used tools of protest. Meetings with
local and national government representatives, forging links with civil
society representatives, and making their voice heard in the media were
other techniques of exerting pressure on the state by trying to shape
public opinion against privatizations. The Movement of the Victims
of Privatizations was not long lived, however, and failed to become
institutionalized due to a lack of trust and commitment on the part of
the majority of its members. Nevertheless, it constituted an important
learning experience for those workers who actively participated in it and
landed a new job as a result of their collective mobilization.
Focus groups and in-depth interviews with the Argentine workers
affected by privatizations showed a consistent pattern of high disillu-
sionment with unions and a sense of individual worthlessness among
those who were dismissed with the "not so much voluntary retire-
ment packages. "23 For Argentine workers, the fight was over once
they realized that their respective unions were not backing them up.
It was clear from the interviews with the rank and file that unions and
union leaders were perceived as demigods in Argentina. Disillusion-
ment and denial that a Peronist government could defy the legacy of
Peronism, which had rallied for nationalizations of the same sectors
only a few decades ago, were present in the hearts and minds of most
Argentine workers.r' This finding is quite interesting since Argentina
is a hub of vibrant social movements and political activism by the
masses. Piqueteros, cartoneros, villas, asambleas, fabricas recuperadas,
and other new social formations abound in Argentina." These orga-
nizations and movements, however, are generally composed not of
former state workers but of young and marginalized individuals who
have either never had a job or who come from the private sector.
CONCLUSION: THE MAIN PUZZLE
This book argues that privatizations might have similar effects on

institutions in the countries of the developing world, while having
divergent effects on their individual citizens. The convergent insti-
tutional effects of privatizations can be observed in structural frag-
mentation, internal organization, and external participation of the
labor unions. Accordingly, privatizations result in three different lines
of responses and reactions from the unions: (I) explicit and active
participation in privatizations (business unions), (2) implicit support
of privatizations (clientelistic unions), and (3) strong repudiation of
privatizations (civic unions). Privatizations also decrease or mitigate
the patrimonialist and partisan associations between the labor union
leaders and government representatives and, as such, contribute to
the conditions that make the formation of an effective and autono-
mous state possible . Finally, although privatizations do not seem to
have immediate effects on unions' internal democracy, such as more
transparent and competitive union elections, they do contribute to
the emergence of a new type of union leader at the local level. The
new leader acts and thinks more professionally, is better educated, has
more competitive goals, and describes himself as a "worker at heart
but capitalist in mind for the good of the workers in this new era."26
The impact of the institutional effects ofprivatizations on democra-
tization is indirect because it is the reaction of unions to privatizations,
which might incidentally promote democratization . Privatizations, in
other words, act as an invisible hand at the institutional level. This
is because privatizations incite unions to start looking for ways to
adapt and survive in a new environment. Were it not for privatiza-
tions and the disturbances caused by them, unions would not have to
renew their strategies and adapt to the changing circumstances. The
democratizing effects of privatizations can only take place if (1) the
important influence of corrupt and rich union leaders is broken, (2)
increased state autonomy does not translate into arbitrary or person-
alist power, and (3) individual workers and marginalized citizens can
effectively be incorporated into the system.
The effects of privatizations at the individual level are divergent
in Turkey and Argentina. Although most workers choose short-term
monetary compensation when downsized as a result of privatizations,
the more educated, relatively younger, and politically active workers
choose to organize against privatizations in Turkey. Social move-
ments and increased political activism on the part of the rank and file
depend, however, on the historical and cultural legacies of the country
at hand. While Turkish workers who lost their jobs as a result of priva-
tizations form vibrant social protest movements, Argentine workers
do not. The higher institutional and political weight of the unions
and the imposing weight of Peronism on the elite might explain the
difference between the Turkish and the Argentine workers' divergent
responses to privatizations. In other words, the Argentine union
leaders' astute use and manipulation of the Peronist ideology might
have deterred the rank and file from taking any independent action
with regard to privatizations . The lack of a parallel labor ideology in
Turkey, on the other hand, might have facilitated Turkish workers
organizing and contesting privatizations without the backing of their
unions. At the end, however, workers in neither country have been
able to form enduring social movements, nor have they increased
their civic activism.
In conclusion, the Turkish and Argentine experiences indicate
that privatizations tend to democratize (labor) institutions, while
they negatively affect individuals since most of the unemployed
ultimately choose not to mobilize and cease to become union mem-
bers as a result of privatizations. While these findings should be taken
with a grain of salt due to nonrandom sampling and can hardly be
generalized beyond Turkey and Argentina, the fact that they emerge
from two countries so different from each other should be enough to
at least stimulate research in the parts of the developing world that
are implementing privatizations and undergoing democratization at
the same time . For now, the task is to process-trace the rich histories
oflabor politics in Turkey and Argentina so that we can better under-
stand the ways in which privatizations have influenced labor and
democracy there.
CHAPTER 2
HISTORY OF LABOR
DEVELOPMENTS IN TURKEy l
FROM STATE-DEPENDENT TO CAUTIOUSLY

AUTONOMOUS UNIONISM
Turkey is the heir to the centuries-long Ottoman Empire and

is currently the only secular democracy in the Middle East. Of its
70 million inhabitants, 98 percent subscribe to the faith of Islam,
although the ways in which religion is practiced and lived vary
considerably across its myriad ethnic and religious groups. The highly
important political positioning of the country in world politics is
mainly due to its role as the essential bridge between the East and the
West, both in geographical and cultural terms.
This chapter traces the emergence and the evolution of the
Turkish labor movement. As such, it provides a background for
understanding the present-day reactions to privatizations on the part
of the Turkish labor unions and the rank and file. It identifies three
idiosyncratic characteristics of the Turkish labor movement: (1) the
patrimonialist nature of labor relations, with the clear dominance of
state, as opposed to the more corporatist Argentine labor system,
where the supremacy of the state is more nuanced; (2) the relatively
weaker political position of labor unions in Turkish politics as com-
pared with their Argentine counterparts; and (3) the lack of an ideol-
ogy equivalent to Peronism in the historical evolution and structuring
of labor relations. These three factors have rendered the reactions of
Turkish labor unions to privatizations weaker, the divisions within
the labor union system less acute, the internal structure of unions
less affected, and the external role of unions less transformed than in
post-privatizations Argentina. Yet, changes have occurred and are all
the same present in Turkey as in Argentina.
The New Institutionalist approach.' followed in this chapter,
illustrates well the reasons why individual Turkish workers have reacted
to privatizations without their unions' backing, and even against their
stance . The three structural/institutional variables listed above have
obviously contributed to this divergent outcome at the individual level
of analysis. A fourth factor that has influenced the mobilization of
Turkish workers against privatizations is that economic crises prior to
privatizations were less powerful and thus less controversial in Turkey
than in Argentina. This made Turkish workers bolder since they did
not have to worry about going back to a hyperinflationary situation.
It was, therefore, easier for them to contest privatizations. Fifth and
finally, Turkish labor, although severely weakened by the 1980 military
coup and the ensuing military dictatorship, has not experienced atroci-
ties comparable to those committed by the Argentine military during
its Dirty War (1976-1983) . This has made Turkish workers less fearful
politically in terms of mobilizing to defy the privatizing authorities.
The lack of any fear of hyperinflation, in turn, has made them more
flexible economically and less violent socially when contesting the
changes brought about by privatizations. These and other characteris-
tics of Turkish labor unions and workers are apparent in the following
historical analysis of labor developments in Turkey.
THE TURKISH POLITICAL CONTEXT:

A HISTORICAL PERSPECTIVE
While the scope of analysis here is limited to the context of labor,
one needs to understand the complex social, political, and economic
underpinnings of the Ottoman system to better grasp the evolution
of the Turkish labor movement. To avoid conceptual stretching,
it suffices to say that the Ottoman Empire was a sultanistic regime
with virtually no civil society.' Labor unions were not a part of the
Ottoman system, either in theory or in practice. Kernels of the labor
movement started to take root with the first modernization efforts of
the Ottoman State in the mid-1800s.
Turkey's European past goes as far back as the 1800s, when mod-
ernization initiatives were undertaken during the reigns of Sultan
Mahmut II and Sultan Abdulmecit. The liberalization efforts and the
shift to a constitutional monarchy in 1876 under Sultan Abdulhamit
prepared the terrain for the end of the Ottoman regime following its
HISTORY OF LABOR DEVELOPMENTS IN TURK EY 33
defeat in World War I. Europeanization continued at full speed with

Ataturk's founding of the Turkish Republic in 1923 . Ataturk, having
liberated the country from the invading Allied forces, abolished the
Sultanate in 1922 and the Caliphate in 1924. He banned the wearing
of religious costumes in public while encouraging the wearing of
suits and hats instead: this was established in a constitutional law in
1925. Ataturk also replaced the Arab alphabet with the Latin alphabet
in 1928, adopted the Western calendar and units of measurement
in 1931, and accorded Turkish women the right to vote and to be
elected as government representatives as early as 1934.4
Elections were instituted with the founding of the Turkish Grand
National Assembly (Turkiye Buyuk Millet Meclisi, TBMM) in 1920.
The declaration of the Republic in 1923 inaugurated a period of
single-party government by the party founded by Ataturk himself.
This period in Turkish history can be characterized as an authoritarian
regime with limited pluralism.f Transition to a multiparty system
took place in 1946. 6 Since then, Turkey has instituted a plethora of
political reforms toward the consolidation of its democracy.
A prominent feature of the Turkish democratization process has
been its interruption by consecutive military interventions, often
executed with the alleged objectives of restoring order and protecting
the secular nature of the Republic. The high degree of fragmentation
of the party system, apparent in unstable coalition governments, has
also complicated the democratization process. After the ideological
polarization of the 1960s, the 1970s, and the 1980s, marked by three
military interventions, the neoliberal Motherland Party (Anavatan
Partisi, ANAP) came to power in 1983 and ruled until 1991.
The period 1991-2003 was characterized by successive coalition
governments and electoral volatility. The election of the right-wing
Justice and Development Party (Adalet ve Kalkinma Partisi, AKP)
with an Islamic pedigree, in 2003, finally put an end to the political
instability produced by coalition governments. The AKP government
also brought stability on the economic plane while reshaping the
divide between the secularist and the more conservative sections of
Turkish society."
Although the main determinants of the democratization process
in Turkey, as anywhere else in the world, are political, politics has
not operated in isolation from the economic arena. Much to the
contrary, economics has always greatly influenced the political pro-
cess of democratization in different and important ways. It has done
so with the political effects of consecutive economic crises as well
as the social impact of various belt-tightening structural adjustment
plans implemented under the guidance of international financial

institutions. How has the economic restructuring affected the
Turkish democratization process? What are the best empirical tools
to study this complex relationship? One way to capture the effects of
economic restructuring on the democratization process is to look at
the changing structure and role of the labor unions and the shifting
attitudes of workers in Turkey.
Overall, the Turkish labor movement can be characterized as weak
and dispersed when compared with equivalent labor movements in
the rest of the world. The few studies on the formation and develop-
ment of Turkish labor institutions attribute these characteristics to
the lack of factors that, in general, yield a vibrant labor movement. In
contrast with the Western European experience, for example, there
was no feudalism, no landlords, no serfs, no bourgeoisie, no aristoc-
racy," no industrial revolution, no civil society, and no proletariat that
could have offered the necessary bases for potential labor institutions
to flourish in Turkey. The sultan istic regime of the Ottoman Empire
(1299-1923) and the quarter century of authoritarian single-party
government in the beginning of the Turkish Republic (1923-1946)
did not help in promoting unionism.
THE TURKISH LABOR MOVEMENT:

One way to understand the evolution of the Turkish labor force and
institutions is to look at their historical progression. Paul Pierson
(2000) argues that in determining sociopolitical outcomes timing,
sequencing, and a few key events matter more than the rational
ordering of preferences of key actors . As such, the order in which cer-
tain key events take place becomes particularly important in causing
the end results. For such an approach, the appropriate methodology
is a historical narrative as opposed to a variable-centered statistical
analysis (Collier and Mahoney 1996).
From such an analytical perspective , the history of the Turkish
labor movement can be divided into three phases: (1) the formation
phase starting with the establishment of the first SOEs in the
erstwhile Ottoman Empire, (2) the development phase starting with
the transit ion to a multiparty system in the Turkish Republic, and
(3) the restructuring phase starting with the switch to free-market
economics in the global era. The critical junctures that have initiated
and determined each one of these phases are (1) the 1838 Free Trade
Agreement between the Ottoman Empire and Britain, (2) the 1946
HISTORY OF LABOR DEVELOPMENTS IN TURKEY 35
transition to a multiparty democracy, and (3) the 1983 election of

Turgut Ozal's neoliberal government."
Formation of Labor: An Ethnically Segregated Workforce

Divided by Nationalism
The Ottoman Empire consisted of a highly centralized state structure
under the absolute hegemony of a sultan, whose power extended to
all spheres of life. As the sole source of power, the sultan made sure
that no other locus of control existed, including labor. The sultan
followed two approaches against the formation of a potential labor
movement. One was the legal route of making laws that explicitly
banned any association based on class. The second was the so-called
timar system.
The timar system divided all of the land in the empire among the
state, the peasants, and the soliders called the sipahis. The state owned
all the land, which was then rented out to peasants . Peasants were free
to leave at any time. But, if they chose to stay, they had to work on
their assigned plot ofland to keep production going. They gave fixed
portions of their produce to the state and kept the rest for themselves
and their families. As for the sipahis, they were soldiers assigned to
specific plots of land to ensure steady and peaceful production while
ensuring the safety of the peasant families. The principal objective of
the system was to feed the large Ottoman armies.
Peasants, in the timar system, were not allowed to sell, transfer,
donate, mortgage, or inherit the land they worked on . They were not
evicted as long as they cultivated their land and paid their taxes in the
form of produce . Eviction occurred only if the land in question had
stayed idle for three consecutive years. Then, it was transferred to
another peasant (Yazici 2003, 55-64). This cycle ensured that state
and society relations were stable and quid pro quo. The timar system,
as such, precluded the emergence of a feudal society.to It made sure
that neither big landlords nor serfs would emerge as separate and
self-conscious social groups while preserving the mainstay of societal
organization based on small subsistence farming by peasant families.
A working class did not fit anywhere in this structure .
If the timar system was the mechanism of control in the country-
side, guilds were their counterpart in the cities. Guilds were artisan
associations of small shopkeepers devoid of any employer-employee
relationship found in production lines in big factories. The organizing
principle in the guilds was expertise, not rank . Typically, three or four
apprentices worked alongside a qualified workman. There was ample
opportunity for upward social mobility. One only had to have talent
and acquire experience by working for a time on a specific craft.
Craftsmen and apprentices were not wage earners. Instead, they were
part of an elaborate scheme of social and ceremonial institutions.
Strong links of brotherhood among the craftsmen constituted the
power of the guild system. Artisans engaged in a given craft came
together to form the professional associations called ahis.II The task
of the ahis was to draft contracts and agreements between craftsmen
and the state. They also kept records of the prices of goods pur-
chased and sold by members. Yet, along with and in addition to these
administrative duties, ahis were fraternity associations with an impor-
tant symbolic and social value. An apprentice who desired to join an
ahi association, for example, had to be shaved, had to wear a salvar,12
and had to repent for all his sins. Nonbelievers, non-Muslims, scien-
tists, drinkers, masseurs, butchers, surgeons, hunters, gamblers, and
fraud-artists were not allowed to apply for membership.
The centralized state structure and the absolutist power of the
sultan, along with the elaborate timar, guild, and ahi systems, were
extensively used by the Ottoman Palace to control the society and
divide it into two large classes: (1) the "governors" consisting of
the military and the palace bureaucracy and (2) the "governed"
comprising peasants and a few categories of craftsmen. This societal
composition was very different from what a typical pre-capitalist
Western society looked like in the early 1800s: a large aristocracy
composed of absentee landlords and contested by the emerging
middle class of entrepreneurs and the large flocks of serfs who were
gradually migrating to cities to become wage earners in the factories
being established as result of industrialization.
Labor started to form in the Ottoman Empire concomitant with
the liberalization efforts undertaken in the second half of the nine-
teenth century. The 1838 Free Trade Treaty signed by the empire
opened the Ottoman markets to England while planting the seeds of
the Turkish labor movement. The treaty in question decreased import
and export taxes on all except the local products sold locally within the
empire . It also brought in considerable foreign direct investment and
new businesses. As such, it fostered the first industrialization endeavor
in the empire while contributing to the gradual disintegration of the
traditional guild system (Ozugurlu 2003, 51) . Small and docile peas-
ant families of the timar system and the inexperienced apprentices
in the guilds now had the option of working for firms set up by the
Europeans in collaboration with the Ottoman Palace. They could, in
other words, become wage laborers in the first SOEs of the empire.
The first SOEs, which were launched with European capital, tech-
nology, and know-how and which operated under Ottoman supervi-
sion, were at the root of the emergence of a segregated working class
in the Ottoman Empire . Established in 1840 by foreign capital and
located in sectors working to meet the needs of the army, such as naval
arsenal and machinery, the first SOEs promoted a workplace organi-
zation in which workers were separated according to their ethnicity.
Skilled workers and the technical personnel were Europeans. Unskilled
workers were recruited from among the non-Muslim subjects of the
Ottoman Empire . There were a few Muslim Turks hired as seasonal or
contracted unskilled personnel (Onsoy 1988, 57) .
Economic liberalization, instigated with the Free Trade Treaty, was
quickly followed by political modernization, with important conse-
quences for the incipient workforce. The wide-ranging Reorganization
Reforms of 1839 (Tanzimat Reformlari) initiated the protection oflife
and property, tax reform, the elimination ofcorruption, and the reform
of the military in the Ottoman Empire . Workers were also included
in these reforms . They could now have a say in the running of work-
places outside the scope of the guild system. The 1876 Constitution
(Mesrutiyet), the empire's first, included the right of association. This
meant, at least in theory, that it was now legal to form unions.
The kernels of what would later on become labor unions soon
started to emerge in the empire . Although segregated by ethnon-
ationality, the emerging working class was unified around one com-
mon issue in this initial period-the apprehensiveness of all toward
the dictatorship of Sultan Abdulhamit II. The first labor organization
was founded in 1895 as a reaction to the increasing despotism of
the sultan.P Secretly established by the cannon-ball factory workers,
who were influenced by liberal Western ideas, the Ottoman Work-
ers Association (Osmanli Amele Cemiyeti, OAC) pledged to remove
Abdulhamit from power. It was disbanded by the secret police only
a year after its formation (Toprak 1982,22). Although symbolically
considered the first labor organization, the OAC was not a union in
the current sense of the term. It was a civic alliance of bureaucrats,
intellectuals, and worker representatives who had allied to topple the
dictatorial government.
While secret labor organizations were unsuccessful in putting an
end to the tyrannical regime ofAbdulhamit II, economic difficulties in
the mid-1800s were . The empire had borrowed heavily from Britain
and France to finance the Crimean War ofl854-1856 . This war and
others financed thereafter with European funds were lost. The for-
mation of the Ottoman Bank with British and French aid could not
solve the empire's financial plight. The Ottoman State declared bank-
ruptcy in 1876, the same year in which the Constitutional monarchy
was instituted. As a result, creditor European nations established the
Office of Foreign Debt Management (Duyun-i Umumiye, DIU) in
Istanbul in 188I.14
The foundation of the DIU signaled the beginning of the second
wave of foreign direct investment in the empire . Europeans invested
heavily in the ports, railways, mines, and commercial agricultural
products such as cotton and tobacco. French investors obtained
management rights over the boron'" mines in Balikesir in 1865. The
Italians and the French acquired the administration of coalmines
in Eregli in 1882. The increasing penetration of foreign ownership
into the empire exacerbated the segregated workplace organization
and introduced a discriminatory wage system: foreigners received
monthly wages, locals daily wages, and Turks hourly wages. By the
same token, the highest wages went to the foreigners, followed by the
local non-Muslims, and finally, the Muslim Turks.
The declaration of the Second Constitutional Monarchy (Mes-
rutiyet II) first made it seem like the segregated workplace organiza-
tion could be reformed. The Young Turks.!? who were the architects
of this important 1908 liberalization effort, initiated the National
Economic Program (Milli Iktisat Programi, MIP). The MIP aimed
at the creation of a unified nation of free enterprise and competition
(Ozugurlu 2002, 83). Some former members of the OAC formed the
Ottoman Association for Progress (Osmanli Terakki Cemiyeti, OTC)
in August 1908. Workers of the Eastern and Anatolian Railway Com-
panies formed organizations that very much resembled labor unions.
Nevertheless, the segregated workforce organization initiated by
the first SOEs survived. Most members of these first labor organiza-
tions were non-Muslim subjects of the empire, that is, Jews, Greeks,
Bulgarians, and Armenians (Quataert 1987, 149).
While classical liberalism was particularly prominent in the initial
phase of the Young Turk rule in 1908, it was gradually replaced with
extreme nationalism. The Young Turk government undertook the
nationalization of businesses owned by foreigners and non-Muslims . To
carry out the transfers, it established provincial mobilization bureaus
that provided easy credit to Muslim and Turk entrepreneurs for the
formation of national cooperatives to buyout foreign firms. The
plan was to get rid of the ethnonationalist organization of the work-
force . Accordingly, union activities would be restricted to forming
worker cooperatives, establishing credit unions and reserve funds,
and setting up night schools and educational conferences for workers .
Unions would not be allowed to embrace Socialism or affiliate with

international labor movements.
Even though the idea of a labor union was now embraced for the
first time in the empire, it was still unclear how unions differed from
guild associations. Like guilds, unions were perceived to be reliable
tools for controlling the incipient working class in the changing
order of the post-Tanzimat era. Therefore, unions could exist only
as complementary to the state and not against it. The state was to
continue to be the sole authority in all matters, including employer-
employee relationships.
There is no consensus among historians on the first strike that took
place in the empire. Some attribute it to telegram workers in Beyoglu,
Istanbul, others to ship workers in Kasimpasa, Istanbul, both in 1872
(Agrali 1967, 18) . Nor is there a consensus over the number ofstrikes
in the period 1870-1907. Alpaslan Isikli (2002) claims that there
were 22, while Turan Yazgan (1982) argues there were 50. What is
clear, however, is that the first mass protests and strikes by the labor
force took place between 1900 and 1910. The most active year was
1908. Known as the "1908 Strikes" (Sencer 1969,205), these mobi-
lizations included one hundred-thousand workers unified around
demands of improving working conditions, getting wage increases,
and guaranteeing regularity in payments. Strikers were unsuccessful
in securing these demands.
The few worker protests that took place in the second half of the
1800s could not become part of a collective memory of resistance
mainly due to the ethnonational divide in workforce organiza-
tion (Koc 1992, 329). By the end of the first decade of the 1900s,
things were different. The demands advanced by the strikers were
significantly different in 1908 compared with before. The small-scale
protests of the period 1870-1907 had mostly been targeted toward
wage increases. In 1908, workers' demands became much more
political: the 76 strikes that occurred during the first few months
of the Young Turk government sought the abolition of ethnic seg-
regation in the workplace (Guzel 1980). Most of the 1908 Strikes
occurred in foreign-owned firms, as opposed to the post-Tanzimat
strikes that occurred in the SOEs.
Foreign business owners were afraid that the 1908 strikes would
escalate into a national fury of violence. They were particularly upset
when labor protests culminated in sporadic independence movements
in different parts of the empire . They pressured the Ottoman State to
repress the uprisings . The consequence was the first strike and union
laws in the empire : the Strikes Law (Tatil-i Esgal Kanunu) followed
by the Associations Law (Cemiyetler [(anunu), both promulgated in

1909. The first worker movements in the empire, therefore, trans-
pired as resistance movements against both the Ottoman State and
foreign capital (Agrali 1967, 18).
The Associations Law banned any association based on family, race,
gender, and class. The Strikes Law disbanded all unions and worker
associations. It prohibited strikes in firms dominated by foreign capital.
This comprised firms operating in the public sector, such as tramways,
railways, tobacco plants, and ports. Instead of strikes, a "system of
compromise" was instituted. Accordingly, in case of disagreement
between employer and employee, a commission of three representa-
tives from both the business and labor groups would be formed. If the
commission could not reach an agreement satisfactory to both parties,
strikes could be staged (Gulmez 1985, 799-800). The Young Turk
government justified this relapse in political liberalization by arguing
that strikes create a bad reputation, thereby hampering the foreign
investment desperately needed in the empire .
The onset of World War I in 1914 silenced the workers even
more. It was very hard for the Christian and Muslim Ottomans to
rally under either socialist or other ideological causes when the non-
Muslim workers were perceived by the Turkish workers to be in close
contact with the British, the French, and the Greek occupying forces.
Nationalism hampered the first plan for a general strike in the history
of the Ottoman Empire in 1921.
The establishment of the Turkish Republic in 1923 did not
change the main rationale vis-a-vis the nascent labor force . The goal
of the Republican People's Party (Cumhuriyet Halk Partisi, CHP)
government was to create a classless national society. Party represen-
tatives questioned the need for a labor movement on various occa-
sions. Occupational and social groups, such as farmers, craftsmen,
businessmen, workers, professionals, merchants, and civil servants,
were desired as constituents of the new Turkish society. At the same
time , however, it was indispensable that these groups maintained
harmonious relations with one another. Class struggle was simply not
part of the Turkish nation-building project. The 1936 Labor Law
reiterated the reigning state ideology dating back to the late Ottoman
times: "The Turkish worker is not and should not be a trouble-maker.
Only a patriotic labor movement as a complementary force to the
central power of the state is permissible" (Turkdogan 1981,611).
Another reason why the early Turkish labor movements and insti-
tutions rested on weak grounds was that there were only a handful of
workers to start with . The Ottoman Empire had 282 industrial firms
with 14,060 workers as ofl915 . Of the total population ofl3.5 mil-

lion in 1927,76 percent lived in agricultural areas, leaving a mere 24
percent residing in cities. Only 8.9 percent of the working population
was employed in the industrial sector in that year. This number had
increased to 11.7 percent by 1935 (Yazici 2003, 105). Small firms
and businesses dominated the Turkish industry. More than 70 per-
cent of businesses employed less than four workers in the beginning
of the Republic. This number was up from two workers in the late
Ottoman Empire (Isikli 2003, 7).
The unification and institutionalization of labor became more diffi-
cult in the post-World War I era since the invasion of the empire by the
victorious alliesonce again led to the explosion of ethnonationalist cur-
rents among workers. Then, the onset of World War II buttressed the
state policy ofexcluding an active, and potentially troublemaking, labor
force from the sociopolitical scene. Although Turkey did not take part
in the war,17 economic hardship and political oppression ruled the day.
Paid mandatory work and longer hours were legislated during the war.
Many women and children joined the workforce to make up for the
men drafted into the army. The 1940 Customs Administration Law
(Orfi [dare Kanunu, OIK) suspended the freedoms of speech, meeting
and association, protest, organization, mobilization, and press. In the
same year, the National Security Law introduced the close regulation
of commerce , industry, and agriculture . Martial law was declared on
December 17, 1946, and stayed in force until December 23, 1947.
Development of Labor: Politicized Labor

Divided by Ideologies
Labor unions finally became legitimate actors in Turkish politics with
the transition to a multiparty system in 1946 . This period was one
in which the governing party since 1923, the CHP, and the newly
emerging opposition party, the Democrat Party (Demokrat Parti,
DP), found themselves in a constant struggle over who would win
the workers' vote . To that end, the CHP stuck to its plan of a classless
society with a unified and nationalist labor. It legislated the Employer
and Employee Unions and Union Federations Law (Isci lie Isveren
Sendikalait ve Sendika Birlikleri Kanunu) in 1947. The law sought to
inject nationalism and statism in the newly formed labor organizations.
According to this law, any union that acted against the national interest
and waged strikes or organized lockouts could be shut down for any-
time between three months and one year by the courts (Gungor 2002,
156) . Unions were also to abstain from becoming involved in politics.
Ironically, however, the CRP simultaneously launched its own

network of unions called the CRP Worker Organizations, which were
subsequently unified under the aegis of the Federation of Istanbul
Labor Unions (Istanbul Isci Sendikalar« Birligi, IISB) in 1948 . The
IISB worked in close cooperation with the Ministry of Labor and
was a political organization par excellence (Erisci 1951). The DP's
counterpart for the IISB was the Free Labor Unions Federation (Hur
jsci Sendikalari Birligi, RISB) . The RISB and the DP, as opposed
to the IISB and the CRP, supported the right to strike. They main-
tained that the right to strike did not go against national interest.
On the contrary, they argued that this was a basic democratic right
that Turkish workers would use in a beneficial way. The divergent
positions of the CRP and the DP on the strike issue contributed to
the latter's coming to power in the 1950 elections strongly backed
by the working class.
While labor was active and highly politicized during the DP's
reign, the party's strong prolabor campaign rhetoric took a shift
once in power. Instead of its promised liberalization package, the
DP government started to look for ways to make unions dependent
on the party. It did that by (1) interpreting the 1947 Unions Law
requirement of union noninvolvement in politics in different ways,
thus seeking to politicize unions in conformity with its ideology and
political agenda; (2) obstructing any union activity contrary to its pre-
cepts, using police brutality or outright shut-down; (3) introducing
the legal cap of 120 Iiras'" per month in union revenues , thereby
making unions financially dependent on the state; and (4) disbursing
state money to friendly unions.
The DP also abandoned its campaign promise of allowing strikes
and did not tolerate a single one for the ten years during which it
governed. Furthermore, it resuscitated the Mandatory Arbitration
Mechanism from the World War II era. According to Work Con-
flicts and Arbitration Regulation decree, the state was to review and
approve all cases involving any employer-employee conflict. The
state's decision in each case depended on the relationship between
the government representatives and the union leaders involved in
the dispute (Gungor 2002, 177). The hard line adopted by the DP
was, in large part, due to its objective of gaining the support of the
emerging Anatolian bourgeoisie.
The degree of politicization of the union leaders was surprisingly
high given that the Unions Law stated explicitly that they should
stay out of politics. The Worker and Friends of Workers Deputies
Congressional Support Committee (Isci ve Isci Dostu Milletvekillerini
Destekleme Komitesi, IDK), formed in 1954 by ten deputies who

were also union leaders, is the quintessential proof of the partisanship
and politicization of the Turkish labor unions (Isikli 1990, 322). The
most pressing goal of this committee, like the Workers Party'? before
it, was to bring more worker deputies into parliament. The commit-
tee was dispersed and its members prosecuted on basis of the fifth
clause of the Unions Law.
The atmosphere of political liberalization created by the transition
to a multiparty system and the economic freedom preached by the DP
ultimately led to the formation of the first and most important labor
confederation of Turkey. External dynamics accounted largely for the
formation of the Confederation of Turkish Trade Unions (Turkiye
Isci Sendikalari Konfederasyonu, TURK-IS), although some internal
factors also played a role.i" The United States' rising fear about a pos-
sible communist insurgency in Turkey contributed to the proclamation
of the 1947 Truman Doctrine and the Marshall Aid Plan for Turkey
and Greece. In addition to the economic aid plan, the United States
sought to organize the Turkish labor force in the American style, that
is, as a nonpolitical, highly centralized, and well-organized movement.
As a result of countless meetings organized by the International Con-
federation of Free Trade Unions (ICFTU), the American Federation
of Labor (AFL), and the Agency ofInternational Development (AID)
with Turkish union and government officials, TURK-IS was officially
established in Ankara on July 31,1952.
Irving Brown, an American unionist, was especially active in the
creation of TURK-IS . Brown emphasized in many of his speeches
that TURK-IS would (1) represent the ideals of freedom and democ-
racy against the Cominforrnr" (2) be centralized, with a high degree
of patriotism among its members; (3) reject affiliation with political
parties; and (4) repudiate class struggle to favor a type of unionism
with close cooperation between employers and the state (Beseli 2002,
245). On the basis of these ideals, TURK-IS grew rapidly. By 1954,
there were 18 federations and 150,000 workers affiliated to it (Sulker
1969,81). By 1960, there were 800,000 formal workers of whom
300,000 were unionized. By 1967, the number of unionized workers
affiliated with TURK-IS had reached anywhere between 850,000 and
1.5 million (Yazici 2003, 129).
The de jure separation between political parties and unions meant,
in the Turkish case, the de facto symbiotic relationship between the
two . Union representatives in TURK-IS were eager to, and could,
become deputies in the Turkish Parliament. On various occasions,
progovernment union leaders threatened their members that if they
were not elected, the government would disband the confederation

(Gungor 2002, 179). Under the DP government, all union activity
was tightly controlled and had to be approved by the government. In
1953, for instance, TURK-IS tried in vain to join the ICFTU, which
ironically had helped found the Turkish confederation in the first
place. Due to the DP's disapproval, it was not until the 1960s that
TURK- IS could accomplish this project of its own .
The dependency relationship between the official labor
confederation, TURK-IS, and the state had reached its zenith by the
mid-1960s when the confederation ratified the nature of the relation-
ship into its bylaws and dubbed it partilerustu politika or the "politics
of above parties (PAP)" . The PAP doctrine reiterated the traditional
aversion to partisanship, but in practice it meant quite the opposite.
PAP was a strategy for survival that consisted of maintaining friendly
relations with the governing party or parties, regardless of their
political leanings, their democratic character, or workers' interests.
In other words, PAP was not about staying outside politics, as it
seemed to imply; it was about getting more ingrained into it . It was
an implicit compromise, a pact of collaboration between the unions
and the government shrouded in the rhetoric of "patriotic unionism"
(Ozugurlu 2002, 181).
PAP made sure that a stable and predictable quid pro quo rela-
tionship existed between TURK-IS and the state. Accordingly, labor
would approve the politics of a given government. The government,
in exchange, would let the unions and union leaders govern inde-
pendently. TURK-IS also ensured its financial survival with PAP. The
state had a part of Marshall Aid reserved for TURK-IS, which upon
receiving the money from the government would distribute it to its
affiliated unions (Beseli 2002, 247) . The aid was very important for
TURK-IS since monthly dues from members were limited and there
was no check-off sysrern.P
The practice of having the government pay TURK-IS continued
until 1962 . After that, aid money was directly given to the
confederation by the aid agencies. This made TURK-IS somewhat
less dependent on the state but increased its internal centralization:
it was now the headquarters of the confederation, which disbursed
an important sum of money to the local unions. The confederation
also had monopoly over educational travels to the United States .
Since it became the locus of financial and political power, opposition
by member unions decreased substantially. The top -down state-labor
nexuses were thus now reproduced in the confederation-union-section
relations.
If it was the right to strike that divided the emerging labor force in
the 1950s, it was the murky PAP principle that did so in the 1960s.
The two main political parties, the secular-modernist CHP and the
liberal-traditionalist DP, once again played out the controversy over
this doctrine rather efficiently to manipulate and divide the labor
movement. The CHP mounted its opposition to the exceedingly inti-
mate relations between the DP government and TURK-IS officials.
It prepared the so-called Declaration of First Objectives (Ilk Hedefler
Beyannamesi, IHB) in which it demanded a quick end to partisan-
ship. It also called for the institutionalization of a senate, free and fair
elections, independence of universities, the establishment of a High
Arbitration Board (Yuksek Hakem Kurulu, YHK),23 a Constitutional
Court and a High Economics Board (Yuksek Ekonomi Surast, YES),
the prosecution of corrupt civil servants, and greater attention to
social justice (Gungor 2002, 185) . The IHB was subsequently incor-
porated into the 1961 Constitution.
Following the CHP's ratification of the IHB, the DP government
grew more authoritarian. At the same time, society became exceedingly
polarized between the DP and the CHP camps. These developments
precipitated the military coup of May 27, 1960, which brought the
CHP back to power after an interlude of In years. The coup produced
a regime with both democratic and anti-democratic elements. The
right to strike and collective bargaining were granted for the very first
time since the founding of the Republic . This was a landmark devel-
opment in Turkish political and labor history. However, the accom-
plishment did not come as a result of a bottom-up process whereby
workers and unions mobilized to obtain these rights . Instead, these
rights were promulgated largely as a result of the personal efforts and
political agenda of the then minister of labor, Bulent Ecevit.
With the liberalization of labor and expanded freedoms, new sub-
groups sprang up within the Turkish labor force. The first internal fis-
sure in TURK-IS occurred in February 1961, when 12 union leaders
left the confederation to form the Workers Party of Turkey (T urkiye
Isci Partisi, TIP). The party strived for independent unionism. Its
raison d'etre was stated as the creation of a union system devoid of
PAP and the organic relationship between TURK-IS leaders and the
state . TURK-IS isolated the TIP and accused it of being communist.
At that point, the TIP had started flirting with the idea of forming a
new confederation.
The initiative of forming a new labor confederation in Turkey
did not come from the TIP, however. When TURK-IS decided to
stop a strike organized in the Pasabahce Crystal Factory in 1966, the
striking unions, that is, the Petroleum Workers Union (Petrol-Is), the
Glassworkers Union (Kristal-Is), Mineworkers Union (Maden-Is), the
Rubber Workers Union (Lastik-Is), and the Istanbul Print Workers
Union (Basin-Is), were temporarily expelled from TURK-IS. As a
consequence, the last three unions came together with the previously
independent Food Sector Unions (Gida-Is) and the Turkish Mines
Union (Turk Maden-Is) to form the second labor confederation in
Turkey. The Revolutionary Labor Unions Confederation of Turkey
(Turkiye Devrimci [sci Sendikalarit Konfederasyonu, DISK) came into
being on February 13, 1967 (Beseli 2002).
The three main reasons for the formation of DISK were:
(1) TURK- IS was not a real worker organization, (2) it was based on
American aid, and (3) its adherence to PAP did not work according to
its original intent. DISK wanted to create an alternative to the dominant
PAP principle. Its plan was to establish a kind of unionism that would
be political, independent, and revolutionary all at the same time. In the
interim, it pushed for land reform and a more extensive and efficient
public sector. DISK had 50,000 members upon its founding (ibid.).
The third split from TURK-IS came in 1971 with the formation
of the Movement of Social Democrat Unionism (Sosyal Demokrat
Sendikalar Birligi, SDSB). TURK-IS members, who defined them-
selves as Social Democrats." were disturbed by the fact that the
rank and file was getting closer and closer to DISK. They pointed to
PAP as the main culprit for this decline in TURK-IS membership.
Ironically, therefore, PAP, whose purpose was to protect the unity
of the union movement, had become the main reason for the three
consecutive splits from TURK-IS at that point: first in 1961, with the
formation of the TIP, then DISK in 1967, and finally, the SDSB in
1971 (ibid ., 243) . TURK-IS did not try to compromise in order to
prevent the secessions.
Divisions in the union movement were caused not only by the
political observance of PAP. The escalating economic difficulties were
also responsible for the crisis in which the unions found themselves
in the 1960s. The Import Substitution Industrialization (lSI) model,
in effect since the 1930s, was not working properly anymore. Social
unrest had reached its zenith by 1968. Student and worker protest
movements, strikes, factory takeovers by workers, and university
takeovers by students characterized the period 1968-1970. The army
intervened on March 12, 1971, once more, to restore order.
The first deed of the 1971 military-backed civilian government
was to change the liberal 1963 Unions Law (no . 274) . The new
Unions Law (no . 1317) outlawed the formation of union federations .
HISTORY OF LABOR DEV ELOPMENTS IN TURKEY 47
It required workers to be active in their specific industry for at least

three years to be eligible for establishing a union. It allowed the
check-off system only in unions that met the conditions for drafting
collective agreements. It made it mandatory for a union to represent
at least one-third of the workforce in a given professional sector in
order to be able to engage in collective bargaining. These and other
restrictions introduced by the new law made many groups uneasy,
including the DISK and the TIP as well as intellectuals and the
independent unions. The ICFTU and TURK-IS, on the other hand,
welcomed the 1971 Unions Law.
The military-backed civilian government was unable to put a
stop to the politicization of the Turkish labor movement. Partisan-
ship increased and links between the political parties and unions
continued to multiply in the 1970s as well. The CHP's new leader,
Bulent Ecevit, adopted an explicitly anti-TURK-IS position, holding
it responsible for workers' pauperization (Beseli 2002, 242) . The
dissident group of Social Democrats within TURK-IS affiliated with
the CHP. With time, the CHP and DISK grew closer. DISK openly
supported the CHP in the 1973 and 1977 elections (ibid ., 241) .
Toward the mid-1970s, it seemed as if each political party had
to have its own union movement and labor constituency. On June
23, 1970, the ultra-right Nationalist People's Party (Milliyetci Halk
Partisi, MHP) established the Nationalist Labor Unions Confedera-
tion (Milliyetci Isci Sendikalari Konfederasyonu, MISK) . This led the
Nationalist Security Party (Milliyetci Selamet Partisi, MSP) to launch its
own labor confederation, the Confederation of Turkish Just Workers'
Union (Hak Isci Send ikalari Konfederasyonu, HAK-IS), on October
22, 1976. The CHP and the Justice Party (Adalet Partisi, AP),25 on
the other hand, fiercely competed for the control ofTURK-IS.
It took another and a much more violent military intervention to
finally put an end to growing partisanship and the extreme fragmenta-
tion of unions in Turkey. The military government of September 12,
1980, abolished all political parties on the grounds that they were rid-
dled with corruption. It initiated a neoliberal restructuring program to
cleanse the economy of the recurring economic crises. Labor was par-
ticularly hard hit . Strikes were forbidden, social rights abolished, right
to seniority compensation eliminated, job and social security, vacation
and leave of absence, and health coverage curtailed, and collective
agreements suspended (law 2822) . Many unions were disbanded,
while all union activity was put on hold until 1984 (law 2821) . Bank
accounts of DISK, MISK, and HAK-IS were frozen . Their property
and documents were confiscated by martial law command centers .
On October 10, 1980, the military government appointed represen-

tatives to govern all the labor organizations. Military management of
MISK and HAK-IS lasted for only a short period of time .26 As for
DISK, the 1980 coup opened a long period of legal prosecutions.
In the trials that lasted from June 26, 1981, to December 24, 1986,
the 264 DISK defendants were given sentences ranging from five to
sixteen years for their allegedly communist activities.
The 1982 Constitution eliminated the "principle of social state"
and replaced it with the "principle of equilibrium among non-equals"
(Pekin 1985, 258) . In terms of the organization of unions, the
new Constitution made it harder to establish new ones. It required
workers who wanted to establish unions to have worked in their
specific sectors for over one year-? and not have been convicted for
any crime, including that of having participated in strikes. Becoming
a national union leader now required having worked in a given sec-
tor for more than ten years. Becoming a local union leader required
a term of one year.28 The 1982 Constitution made it illegal to serve
more than four consecutive terms as a union leader." It also made it
harder for workers to become unionized by requiring them to go to
a public notary and pay for membership registration prior to joining
a union. Finally, the 1982 Constitution nullified the membership of
anyone registered in more than one union.
These and the accompanying legal regulations greatly increased
the state's influence on unions, both politically and financially.
Accordingly, unions that would terminate their activities by their
own will were required to transfer their property to the Treasury. If
abolished by a court order, the union in question would have to leave
its property to the Unemployment Bureau (Isci Bulma Kurumu,
IBK).3o It was now forbidden to draw up more than one collective
agreement in a given workplace . The "double threshold" require-
ment made it extremely hard for a union to actually enter into a
collective agreement. According to this requirement, a union had to
enroll 50 percent plus one of the workers in the workplace and 10
percent of workers'" in the sector as a whole, to be able to participate
in collective bargaining. Such regulations gave tremendous power to
the state since it was the Ministry of Labor and Social Security that
determined the total number of workers in each industry. If the latter
was announced to be higher than it actually was, many unions could
be disqualified from collective bargaining. Nevertheless, TURK-IS
defended the 10 percent limit on the grounds that it prevented union
inflation and employer-dominated unionism. But the 50 percent plus
one clause proved to be controversial for both DISK and TURK-IS.
HIS TORY OF LABOR DEV ELOPMENTS IN TURKEY 49
The 1982 Constitution was very specific and rigid on the question
of strikes (Pekin 1985,276). Strikes with political objectives, general
strikes, solidarity strikes, slowdowns, and other types of worker pro-
tests were banned . Strikes could not go against the national interest
or the public good, as defined by the military. Only "strikes of inter-
est" were permitted. Such strikes stemmed from conflicts during and
arising from collective bargaining. "Strikes of rights" were strictly for-
bidden, which meant that no strike could be staged after the signing
of collective agreements. This deprived unions of their supervisory
power over labor relations.V
The 1982 Constitution limited union activities to "protecting
and developing economic and social rights and interests of their
members." The fifty-second clause and the Unions Law no . 37
barred unions from becoming involved in politics (Genis 2002, 278) .
They could, however, engage in "professional activities" to advance
workers' economic interests. The wording of "professional activities"
was later expanded to "activities and declarations." Nevertheless,
unions were not allowed to pursue political 'objectives, participate
in political activities, collaborate with political parties, or contribute
money to them . Unions and confederations were also prohibited
from acting in tandem with civil society and professional organiza-
tions for political purposes. Union and confederation leaders were
now barred from holding simultaneous positions in political parties.
If a union leader became a candidate in local or general elections, her
union job was suspended during the time of candidacy. If elected, her
union job was terminated.
In addition to the constitutional restrictions on strikes, many
nonlabor authorities possessed the authority to ban, postpone, or
require prior permits for strikes in certain industries and workplaces,
in the cases of war, fire, and natural disasters . These authorities were
the cabinet, regional governors appointed by the military, and martial
law generals. Free industrial zones established by the Free Regions
Act in 1985 banned all strike activity in these areas for ten years. Once
a strike was banned, it could not be restaged. The Anti-Terror Act of
1982 exacerbated the isolation of workers. The YHK made sure that
strikes would be less frequent by explicitly stating that the damages
incurred in the workplace during a strike would be the sole responsi-
bility of the union involved.
Although the 1980 military coup dealt a serious blow to the politi-
cization of labor through the 1982 Constitution, TURK-IS stayed
faithful to its founding principle of maintaining good relations with
the government regardless of whether the latter was democratically
elected or not. Many TURK-IS leaders held important positions in

the military government. The objective of the confederation was, as
usual, to derive as many benefits as possible from collective agree-
ments. This, in turn, was only possible by adhering to the doctrine of
PAP and the tradition of dependent state unionism.
Restructuring of Labor: Tripartite Division

of Labor by Privatizations
Amid growing social discontent over its rule, the military relin-
quished power to civil authorities in 1983 . If the military coup of
1980 could not entirely succeed in its objective of eliminating the
PAP, the ANAP, which won the 1983 general elections, certainly had
the potential to do so. The ANAP had the perfect technocratic cadre
to carryon with the neoliberal program initiated by the military. The
post-1983 era was clearly about deunionization and the isolation of
workers. New practices such as the hiring of contracted personnel and
interns, who were not allowed to unionize, and working from home,
where union rights did not apply, were some of the policies employed
to push for deunionization (Koc 1991).
Toward the end of the 1980s, the ANAP started using more
subtle anti-union tactics, including anti-union propaganda directed
at the public . Consequently, as shown in figure 2.1, deputies with a
labor background substantially decrea sed in the Turkish Parliament
in the 1980s and the 1990s. Furthermore, most national deputies of
union origin who entered the parliament came from the social demo-
crat parties such as the CRP, the Social Democrat People's Party
(Sosyal Democrat Halk Partisi, SRP), and the DSP (Mahirogullari
2005,416) .
20
ell
.!!!
'S 15
-...
c-
Q).
oe
0 10
Q) 8
.c
E 5
:::l
Z
0
1940 1950 1960 1970 1980 1990 2000 2010
Election Years
Source: Data based on Mahirogullari(2005).
Figure 2.1 Turkish deputies with union background (1940-2005).

It took a few years for TURK-IS officials to realize that the ANAP
government was reluctant to continue with the tradition of state-
dependent unionism. So, until 1987-1988, TURK-IS tried in vain
to enter into a standard patron-client dialogue with the government.
Meanwhile, the rank and file grew uneasy with the confederation
representatives' inability to secure wage increases and other benefit
packages from the government. The discontent over the consecutive
collective agreements devoid of wage increase stipulations culminated
in the notorious "1989 Spring Strikes."
The 1989 Spring Strikes were the first mass worker movements
devoid of official union leadership backing in Turkish history. They
included protest movements that were previously unheard of. Hunger
strikes, leaving work altogether to go see the firm's doctor, protest
marches with bare feet, mass telegrams to politicians, and mass
divorce proceedings based on the premise that the belt-tightening
policies were incompatible with a steady and happy family life were
some of the innovative forms ofdissent . Agitation within the rank and
file contributed to diametrical changes in TURK-IS's modus operandi
to make it, for the first time since its foundation in 1952, an explicit
opposition block in the 1989 local elections. A massive turnover also
took place in the union confederation's leadership . In all, 48 percent
of local union leaders and 49 percent of federation representatives
and union leaders quit as result of the mounting pressure from the
base (ibid .)
The strikes showed first of all that the rank and file could become
unified and demonstrate its collective indignation, with desired
effects on the political position of the confederation. This was a first
in the history of Turkish labor. Second, again for the first time, a
confederation took an openly anti-government stand and influenced
government actions as a result. Third, the mass movement led to the
first general strike in Turkey in 1991. Fourth, there was, for the first
time, collaboration between unions of different hierarchies, in this
case, at the confederation, federation, and local levels, and individual
workers in the staging of the 1991 general elections .
Among the reasons for the failure of the ANAP in the 1991
national elections were the 1989 Spring Strikes and the 1991 general
strike. The new government was a coalition of the True Path Party
(Dogru Yol Partisi, DYP) with the SHP. The bulk of the electoral
support for the DYP had come from labor, which, for the first time,
pressed forward with the demand for democratization. As politi-
cal but more autonomous actors, labor unions seemed to take on
a new role of watchdogs making sure that the DYP-SHP coalition
government kept its campaign promises and expanded union

freedoms (Genis 2002, 285-87). Labor unions also supported the
International Labor Organization (ILO) Conventions no. 59, 87,
135, 142, 144, 151, and 158, which were approved in the parlia-
ment on November 22, 1992 (Gulmez 1988).33 And the traditional
and closed-door patron-client dealings abated.
In addition to changes in the PAP doctrine and the first viable
labor opposition to the government in the 1990s, one other visible
novelty in the Turkish labor movement of the global era was the voic-
ing of new demands, including a new and democratic Constitution,
the democratization of laws pertaining to work conditions, and a
greater freedom of association . The new strategy to accomplish these
goals involved strengthened collaboration among the confederations
and new alliances with the emerging civil society. In 1992, unions,
for the first time, directly mobilized for democracy. A civil society
organization, the Platform of Democracy (Demokrasi Platformu), 34
was formed by the three confederations in collaboration with 18 pro-
fessional associations on November 29, 1993. The new organization
published a communique in which unions were declared to be the
guardians of democratization. When, in February 1994, rumors of a
coup circulated in the media, unions openly opposed such a course of
action (Genis 2002, 288) .
Another important change in the 1990s was the reemergence of
DISK on the Turkish labor and political scene. With the Court of
Appeals' decision of July 16, 1991, DISK leaders and members who
had been imprisoned since the 1980s were acquitted. After 11 years
of cessation of its activities, the first general meeting of DISK took
place on July 20, 1991. DISK declared its new mission to be "the
earning back of confidence, work for democratization and the resolu-
tion of political problems" (ibid., 214). DISK proposed to espouse
the necessary economic, industrial, and technological changes to
survive in globalization while defying privatizations. The distrust
towards DISK's leftist ideology and its recourse to violence in the
pre-1980 coup is still a problem plaguing its "culture of confronta-
tion" in dealing with privatizations.
While DISK was resuscitated with the democratization efforts that
accompanied economic restructuring, another important change in
Turkish labor in globalization was the divergence in the strategies
of TURK-IS and DISK for the first time. Until the 1980s, these
confederations had both targeted increases in workers' wages through
legal changes and bargaining with the government. Doing that,
they had neglected the issues of better work and living conditions.
They had also limited strikes and other protest activities to work-
places (ibid., 296). In contrast, in the 1990s, TURK-IS took an
anti-government position for the first time and gradually shed its
allegiance to the traditional PAP doctrine, subscribing to a more
professional "culture of compromise ." Both DISK and TURK-IS put
emphasis on the issues of work and living conditions in addition to
wages in the 1990s.
The HAK- IS also underwent changes in the post-I980 period .
First, it became a more active confederation. It had had only
limited activities in the 1980s, since it was confused about its proj-
ect of Islamic unionism. Its role had thus stayed confined to being
a critic of TURK- IS with no clear plan of its own during that
period . In the 1990s, HAK-IS resolved its ideational dilemmas by
redefining the Islamic values of labor and adopting a more secular
outlook. The change of its emblem from the triad of a "mosque,
crescent and factory" to a set of "oracle, olive branch and cres-
cent" is a case in point. In the mid-1990s, HAK-IS redefined
Islamic unionism as procapitalist and capital friendly, but against a
patrimonial state . As such, its panacea became the formation of a
vigorous civil society and a vibrant private sector, which could then
potentially produce an Islamic model of labor and social relations
on its own (ibid., 286) . HAK-IS concentrated on counterbalancing
the state's power by following a policy-based approach and pio-
neered a "culture of business unionism."
New union attitudes signaled the beginning of a more autono-
mous, engaged, and pragmatic union movement. Collective agree-
ment making, on the other hand, did not seem to undergo any
changes in the global era. Table 2.1 gives the breakdown of the
number of collective agreements per year (1996-2005) in the public
and private sectors. It shows that the number of collective agree-
ments signed in workplaces active in the public and private sectors,
respectively, are generally close to each other except in 2001 and
2002 .35 The number of collective agreements increases in both sec-
tors starting with 2003 . The number of workplaces involved in the
collective agreements fluctuates from year to year and does not seem
to present any consistent pattern over time . This is because the num-
ber of unions that can sign collective agreements changes according
to the legally preset threshold levels of representation comprising 10
percent of the workers active in a given sector and 50 percent plus
one of the workers in a given plant. Therefore, the number of collec-
tive agreements is much more determined by institutional rules than
by economic factors in Turkey.
Table 2.1 Collective agreement making in Turkey (1996-2005)
NUMBER OF NUMBER OF
NUMBER OF WORKPLACES WORKERS
YEARS SECTOR AGREEMENTS INVOLVED INVOLVED
Public 861 6.971 281.190
1996 Private 1.010 3.319 234.650
TOTAL 1.871 10.290 515 .840
Public 1.137 9 .638 544.995
1999 Private 1.149 2.735 283.463
TOTAL 2.286 12.373 828.458
Public 1,113 4,741 131,852
2002 Private 660 2,712 123,207
TOTAL 1,773 7,453 255,059

Public 1.176 10.302 382 .992
2005 Private 2.801 4.086 204.464
TOTAL 3.977 14.388 587.456
Source: http ://www.calisma.gov.tr/istatistik/cgm/yillar_tis.htm .
CONCLUSION: THE TURKISH LABOR

MOVEMENT IN PERSPECTIVE
The Turkish labor movement, since its inception in the Ottoman

Empire, has been dogged by ethnonationalist cleavages, military
interventions, and partisan policymaking. The economic and political
changes introduced by the neoliberal ANAP government between
1983 and 1991 have transformed the Turkish labor movement in
specific ways. Until the 1980s, the labor movement was characterized
and shaped primarily by (I) state-dependent unionism and its PAP
doctrine, (2) lSI and a closed economy, and (3) labor unions' lack of
independent and competitive political experience, especiallyin the case
of the unions active in the public sector.
The profusion of SOEs contributed immensely to the failure
of a vital labor movement until the 1990s. A worker whose employer
was the state failed to act, or simply opted out of acting, as a
political animal, meaning that he did not participate in politics know-
ing and defending his legal and civic rights . That is so because a
state-employed worker (1) was part of the tradition of state- depen-

dent unionism and benefited from it and (2) took it for granted that
whatever political party was in power, his needs would be taken care
of. The simple arrangement was for him to vote for the party in power
as instructed by the union leader and support government policies
to receive wage increases and other benefits from the paternalistic
employer (ibid ., 295) . Ozal's restructuring of the economy through
privatizations broke this historical pattern and is thus an important
critical juncture in changing the developmental pattern of the labor
movement in Turkey.
In sum, the three ways in which the labor movement changed
toward being a more democratic and active player in Turkish politics,
starting with the 1990s, can be categorized as follows:
Political Unionism: This refers to the new strategy of TURK- IS to
first tr y to negotiate with the government in power through patron-
client relations to see if PAP can be resuscitated. In case this strategy
fails, constituting a strong opposition block and questioning the
policies and the very legitimacy of the government in power follows.
In case negotiation with the government is welcomed, TURK-IS
embarks upon extensive political bargaining involving market research
on the issues discussed, comparisons derived from the experiences of
other countries, and the modernization of the labor movement. This
type of political attitude and this style of negotiation are quite differ-
ent from the former clientelistic style wherein TURK-IS positioned
itselfas the government's interlocutor, regardless of the government's
political platform .
Socioeconomic Unionism: This refers to attempts by HAK-IS to
restrict the state in the socioeconomic sphere for civil society and
the private sector to take over these areas. To achieve this aim, the
use of civic strategies of reaching out to communities and businesses
for social projects, visiting foreign countries and studying their labor
experiences to learn from them and devise new projects, and actively
participating in Turkish privatizations have been some of the features
of the type of unionism adopted by HAK- IS in the global era.
Ideo-Intellectual Unionism: This refers to attempts by DISK to
tap into a new societal consensus involving Turkey's accession to the
European Union and the industrial requirements of being an advanced
democracy. Hiring younger and highly educated personnel as research-
ers and advisers, involvement in research and development, and the
publication of detailed reports and analyses of political, economic,
and social projects encompassing the Turkish society as a whole are
some of the methods espoused by DISK to shape its new role and
identity in globalizing Turkey (ibid ., 302).
In addition to these distinct yet mutually inclusive identities regard-
ing the three branches of the Turkish labor movement, confederations
have also contributed to democratization in the 1990s by (1) cooper-
ating more with each other and civil society organizations while pre-
serving their autonomy; (2) explicitly supporting the democratization
project and taking a clear stand against attempts at reversing it; and
(3) giving in to the demands of their rank and file and the unemployed
to support, or at least, not to become a barrier against formations
outside the scope of unions.
Despite the considerable progress unions have made in becoming
democratic playersin Turkish politics, they still have a long way ahead to
transform themselves into undisputable actors ofdemocratization. Part
of the unfinished task awaiting the Turkish labor unions can be sum-
marized as (1) overcoming the ideological barriers dividing the confed-
erations to more actively cooperate with each other, (2) democratizing
the internal functioning of unions through more transparent elections
and regular reports about the internal workings, and (3) making the
system of revenue collection and spend ing more transparent.
Why did such changes occur in the PQst-1980 period and acceler-
ate in the 1990s? What are some of the obvious consequences of these
changes in the 2000s? Can convergent patterns of development be
found in the labor movements in other parts of the developing world?
One way to answer this question is to look at another developing
country that is historically, religiously, and culturally distinct from
Turkey and geographically as far away from it as possible. Ideally,
this country would also have distinct political and electoral systems
to avoid any possible causality between these two factors and the
structural/institutional changes observed in the unions. I, thus, now
turn to Argentina to see how its labor history, despite being shaped by
completely different historical forces, has ended up with surprisingly
similar traits and divisions in the global age.
CHAPTER 3
HISTORY OF LABOR
DEVELOPMENTS IN ARGENTINA
FROM PERONIST TO CAUTIOUSLY

INDEPENDENT UNIONISM
Argentina, located in South America's Southern Cone, is an ethni-

cally homogenous country composed primarily of immigrants from
Italy and Spain. Its history and polity are marked by the centuries-
long colonization by Spain (1516-1816). Of its 70 million inhabit-
ants, 80 percent subscribe to Roman Catholicism, although most
Argentines do not practice religion. While not a pivotal state in the
sense that Turkey is in East-West geopolitics, Argentina is important
for it used to be one of the richest countries in the world at the
beginning of the twentieth century and was ranked as one of Latin
America's richest countries and its third-largest economy, after Brazil
and Mexico, until recently (Ramakrishna et al. 2003, 1).
This chapter traces the emergence and evolution of the Argentine
labor movement. It strives to give us a better understanding of
present-day reactions to privatizations on the part of Argentine labor
unions and the rank and file. It also contributes to the main argu-
ment of this study, that privatizations have convergent effects on labor
institutions, by identifying the three main characteristics of Argentine
labor relations : (1) the statist nature of labor relations embedded in
a corporatist system, (2) the strongly political and partisan role of
Argentine labor unions and union leadership in politics, (3) the domi-
nant populist ideology of Juan Domingo Peron whereby the working
class is empowered socially, politically, and economically, even though
58 DEMOCRATIC INSTITUTION S
the union leaders, and not the rank and file, appear to be the most
obvious and direct beneficiaries of such empowe rment. These three
factors have rendered the reactions ofArgentine labor unions to priva-
tizations stronger, the divisions in the union structure more acute, the
internal structure of unions more affected, and the external role of
unions more transformed than in post-privatizations Turkey.
The historical analysis and the New Institutionalist approach
adopted in this chapter also illustrate the reasons why individual
Argentine workers have not reacted to privatizations by organiz-
ing protest movements without their unions' backing . The three
structural/institutional variables outlined above have contributed
their fair share to this unexpected outcome . A fourth factor that has
contributed to the lack of mobilization among Argentine workers
against privatizations is that economic crises prior to privatizations
were extremely powerful and thus much more controversial in Argen-
tina than in Turkey. This made the Argentine rank and file more
accepting of privatizations as a possible solution to hyperinflation.
Fifth, and finally, Argentine labor was severely weakened by the
Dirty War (1976-1983 ). Thousands oflabor activists who disappeared
or were killed during the military dictatorship rendered Argentine
workers more fearful politically, thereby inhibiting their mobiliza-
tion against the privatizing authorities. In sum, fear of hyperinflation
coupled with the memories of military repression seriously weakened
the links of solidarity and collectivism in the Argentine working class.
As such, Argentines were more welcoming of privatizations as a pos-
sible solution to economic calamities, just as they were more violent
in contesting them when democratization gradually made them less
fearful of the military. These and other unique characteristics of the
Argentine labor unions and workers are apparent in the following
historical analysis of labor developments in Argentina.
THE ARGENTINE POLITICAL CONTEXT:

Argentina was one of the many Spanish colonies in Latin America
until its declaration of independence from Spain in 1816 . It was
historically a poor country due to its insufficient convergence with
European markets, particularly when compared with the busy port
of Lima in Peru between the sixteenth and the eighteenth centuries.
Its political disarray, marked by feuds among provincial caudillos,
who refused to share power with one another and with the city of
Buenos Aires, only exacerbated Argentina's political and economic
HISTORY OF LABOR DEVELOPMENTS IN ARGENTINA 59
plights (Grindle 2000, 151 ).1 The main internal conflict in Argentina
concerned the power-sharing arrangements between centralists from
the city of Buenos Aires, who fought for the creation of a liberal
republican government, and federalists from the interior, who resisted
both central authority and liberalism and viewed Buenos Aires as the
headquarters of the exploitative Spanish colonialism .
In clear contrast with the highly centralized and institutionalized
Ottoman State, which never underwent colonization.i Argentina
was the epitome of colonization and countless unsuccessful efforts at
national unification thereafter. In fact, the idea of "Argentina," as a
nation, did not appear in official writings until after 1860 (Whitaker
1964, 37) . The general picture until the end of the nineteenth
century consisted of semi-autonomous regional powers fighting with
one another to be established as the legitimate representative of the
country. By the mid-nineteenth century, Buenos Aires had become
the entry port for thousands of skilled immigrant workers from all
over Europe, primarily from Spain and Italy, seeking a better future .
By the beginning of the twentieth century, the political and economic
power of Buenos Aires had clearly become superior to the interior,
leading to the gradual disappearance of the centralist-federalist feud .
Presidents chosen thereafter by the National Assembly, composed of
caudillos from Buenos Aires and the interior, unified the country and
ensured relative political stability.
The political and economic victory of Buenos Aires over the rest
of the Argentine provinces did not only mean the end of the political
problem of unification. It also signified the rapid economic develop-
ment of the country as a whole . By choosing not to take part in World
War I, Argentina had clearly made the right decision as opposed to
the Ottoman Empire, which by becoming a German ally had liter-
ally signed its own death warrant. In 1914, therefore, Buenos Aires
was the nascent "Paris of the South," with a booming population,
technological innovations, economic prosperity, political stability, and
cultural richness (O'DriscoIl2002) . Istanbul, on the other hand, was
a decaying capital-the "Sick Man of Europe" was how the disinte-
grating Ottoman Empire had come to be known by the end of World
War I (Livanios 2006) .
Despite increasing foreign investment, immigration, cultural
blossoming, and an economic boom, tensions continued to plague
Argentina. The old oligarchy, the new urban middle class, and the
emerging working class of immigrants clashed over the sharing of
power and resources (Grindle 2000, 154). The emergence of new
classes and actors spurred by the country's rapid economic expansion
led to the establishment of a new political force in 1916: the Radicals,

led by Hipolito Yrigoyen. They became the main adversaries of the
traditional rural caudillo elite who, until then, had ruled the country
single handedly. The Radicals, for the first time, emphasized free
and fair elections, universal suffrage, and democratization while
welcoming the emerging middle class.
These developments in Argentina were very different from those
in the Ottoman Empire, which was also opening up with the 1838
Free Trade Treaty signed with Britain, but within the strict bound-
aries of centuries-long state traditions and deeply ingrained political
rules and norms. These same rules and developments in the Ottoman
context were not propitious for the creation of a middle class or a
working class. By the time World War I had ended, all hopes of eco-
nomic development were lost, as was the empire .
Argentina, much in contrast with Turkey, had its first encounter
with democratization as early as 1916 with the formation of the
Radical Party. Another contrast was that its political history was char-
acterized by the rise to prominence, in the mid-1940s, of a single
individual, General Juan Domingo Peron, who became the architect
of the strongest labor movement in all of Latin America. Peron, by
tapping into the marginalized power of the large labor constituencies,
quickly became a national hero . His populist policies were instrumen-
tal in paving his way to the Argentine presidency. The international
economic environment, which favored the lSI model of develop-
ment, also helped him in his ascension .
Consecutive military interventions against the rising influence of
Peronism and concomitant attempts to open up the economy to
market forces dominate the political and labor history of Argentina
between the 1950s and the 1980s. Peron had nationalized foreign
firms operating in Argentina when he came to power in 1946. It
is, therefore, ironic that it was a Peronist government that led the
neoliberal restructuring of the Argentine economy in the mid-1980s.
The Peronist Justice Party (Partido ]usticialista, PJ) and its leader,
Carlos Saul Menem, who was a conservative caudillo from the
smallest province of the interior, La Rioja, justified a shift in ideology
and methodology on the basis of Peron's adherence to pragmatism
and the need to adapt to changing circumstances. The world was
globalizing, and countries all over the world were opening up to
attract foreign direct investment and to favor export-oriented models
of industrialization. Argentina had to adapt in order to overcome
its recurring economic crises. Turkey's transition to a free market
economy in the mid-1980s was also justified on similar grounds.
HISTORY O F LABOR DEVELOPM ENTS IN ARG ENTINA 61
THE ARGENTINE LABOR MOVEMENT:

Argentina is the country with the strongest labor movement in Latin
America (Etchemendy 2001, 1). The former general and labor leader
Peron has come to personify the Argentine labor movement, even
though the history of the Argentine working class goes further back
than Peron . As such, the emergence of the first and strongest labor
confederation, the CGT, in 1930 constitutes the first critical juncture
in the history of the Argentine labor movement. Peron's rise to power
in 1946 is the second, and Menem's accession to the presidency and
his neoliberal reforms in 1989, the third.
These critical junctures, respectively, are associated with the
following three phases of development in the Argentine labor
history: (1) the formation phase starting with the influx of European
immigrants in the 1900s, (2) the development phase starting with
the surfacing of Peronism in 1946, and (3) the restructuring phase
starting with the transition to free markets in the 1990s.3
Formation of Labor: A Nationally Diverse

Workforce Divided by Ideologies
The pre-Peron labor history in Argentina can be seen as a period of
endless clashes among anarchist, socialist, and syndicalist groups of
workers, each of which had a different opinion on how to organize
the working class and the Argentine society as a whole . Anarchists,
who constituted the first wave of immigrants from Spain and Italy
in the mid-1800s, sought to destroy the then dominant gentry or
estancieros.t The y aimed at the creation of an egalitarian society
controlled by workers and advocated the use of strikes, walkouts, and
sabotage to reach their respective ends (Alexander 2003) .
Socialists, composed mainly of immigrants from Northern Europe,
aimed for the political rights of voting, collective bargaining, and pro-
tective labor laws. They wanted to attain these goals by mainly using
parliamentary methods. The socialists' main opponents were the anar-
chists, followed by the estancieros. Unlike the anarchists, who opposed
direct and explicit links with political parties, the socialists encouraged
using parties as legitimate means of advancing labor interests. Socialist
workers set up caucuses in individual labor unions to coordinate the
actions of the working class with those of the socialist parties (ibid.).
Syndicalists who, for the most part, were native Argentines, were
interested in bread-and-butter politics and had no aspirations toward
social engineering. While the syndicalists as a group were against

any involvement with political parties, many of the members had
their origins in the Socialist Party. Syndicalists' main opponents
were the estancieros, while their main support came from the Radical
Party. It was during the Radical administration of Hipolito Yrigoyen
(1916-1921) that the syndicalists abandoned their principle of anti-
politics and leaned toward partisanship (Garguin 2000) .
The first worker associations in Argentina, a country with a pre-
dominantly immigrant population, were mutual aid societies formed
by immigrant workers, who sought to assist one another in adjusting
to life on a new continent (Decker 1983, 67). Mutual aid societies
included workers from the same country-each aid society having its
own language, customs, and ideologies. At a first glance, it seemed as
if it would be difficult to set up a vigorous union movement among
people with vastly different backgrounds. Obstacles notwithstanding,
immigrant workers were virtually all from Europe. As such, cultural
affinities were relatively high . Unification of the working class was
further facilitated by the fact that, much to the contrary of what
happened in the late Ottoman and early Turkish contexts, ideologies
rather than nationalities determined the initial phase of the Argentine
labor movement. The reason ideological differences overrode the
nationality divide may be that all workers were immigrants in a new
continent and country, as opposed to the static and legally defined
ethnonational boundaries in the Ottoman Empire . Furthermore,
Argentina did not participate in wars that could have exacerbated the
nationalist tendencies and divides amongst the populace.
The first Argentine labor union was formed in 1871 by the Mutual
Aid Society of Printers of Buenos Aires. The rationale for the founda-
tion of the Printing Trades Union was to obtain higher wages and
better working conditions. The first labor union newspaper, The
Typographic Worker (EI Obrero Tipografico), was published only a year
later. The first walkout and work stoppage took place in 1878, again
by the Printing Trades Union (Schiller 2008, 10). The first general
strike occurred in 1902 (Munck 1987,42). The first labor federation,
known as The Federation of Workers of the Republic of Argentina
(Federacion de los Trabajadores de la Republica Argentina, FTRA),
was established in 1890. The first federation experience, however, was
cut short by violent clashes between the socialists and the anarchists .
Attempts to revive the FTRA in 1894 and 1896 proved unsuccess-
ful. Finally, the Argentine Workers Federation (Federacion Obrera
Argentina, FOA) was formed in 1901. Its name was changed to
the Regional Workers Federation of Argentina (Federacion Obrera
Regional Arqentina, FORA) following the anarchists' protest that

no labor organization could national, but only be regional. Socialists
soon seceded from the FORA and established their own labor fed-
eration in 1903 . Their organization was called the General Workers
Union (Union General de Trabajadores, UGT) . During this initial
phase in the Argentine labor movement (1890-1912), the anarchist
FORA dominated over the socialist UGT (Di Tella 2003).
The 1890s constituted a favorable decade for the labor movement
in Argentina. In addition to the first labor federation, the first labor
party, known as the Socialist Workers Party (Partido Socialista Obrera,
PSO), also came into being . This party, established in the late 1890s,
was initially organized along the nationality divide like the former
mutual aid societies, though with significant cooperation and collabo-
ration among members. The major opposition to the Socialist Party
came from Argentina's Radical Party, Union Civica Radical (Medina
and Cao 2002, 170). Socialists did not fare well against the Radicals
since they, the Socialists, required citizenship for membership and the
Radicals did not (Haas 1987,2). This was another proof that nation-
ality was not as important as ideology in Argentine politics .
The first legislative measure directly targeted at labor was the 1902
Residency Law (Ley de Residencia). This law allowed the president to
extradite any foreigner guilty of a common crime or posing a threat
to national security and public order. It also determined the charac-
teristics of the type of labor movement that was about to emerge in
Argentina: constant warfare between an authoritarian government
and the rising unions, regardless of ideological backgrounds. This
development contrasted starkly with the incontestable and well-
established power of the Ottoman State, which clearly dominated
a weak and an ethnically divided workforce . The palpable contrast
in the emerging conditions of the Argentine and the Turki sh work-
ing classes and labor movements proved crucial in their subsequent
developments as well. The Argentine working class was searching for
a leader who could unify the movement and a system with clear rules
to heip organize labor in the first place. As for the incipient Turkish
working class, the objective was a liberalization of the existing struc-
tures and norms within which labor was cast.
The first attempt to create a labor confederation in Argentina was
made in 1907, when the socialist UGT pushed for unification with
the anarchist FORA. The effort resulted in the Regional Workers
Confederation of Argentina (Confederacion Obrera Regional A1lfentina,
CORA). Instead of bringing unity to Argentine labor, however, CORA
worked more to strengthen the anti-anarchist groups. Once the
64 DEMOCRATIC INSTI TUTIONS
anarchists were out of the picture by 1910, the syndicalists started

their own domination of the Argentine labor. Most members of the
anarchist FORA joined the now syndicalist CORA, also known as
FORA IX. This body became the strongest labor organization in
Argentina in the period 1915-1921 (Di Tella 2003) .
The syndicalists' domination of the emerging labor movement
came to an end with the so-called Tragic Week (La Semana Tragica) .5
This stemmed from a strike that started in a metal products plant
in Buenos Aires in January 1919 and quickly spread to other cities
across the country. Several strikers were killed in the clashes with the
security forces. After this incident, the Radicals put an end to the
incorporation of labor into their party and refused to give preferen-
tial treatment to the syndicalists. Instead, they concentrated on the
support of their traditional constituencies-the middle class and the
national bourgeoisie (McGuire 1995,207).
Following the syndicalists' loss of power, the socialists gradually
replaced them as the dominant voice in the labor movement. The
1920s and the 1930s were all about the power struggle between the
socialists and the syndicalists. The institution that would host this
new clash was the Argentine Workers Confederation (Confederac ion
Obrera Arqentina, COA), founded in 1926. The myriad labor
confederations of various ideological affiliations were finally united
when the largest and the most influential labor organization of Latin
America-the CGT-was founded in September 1930. The CGTwas
the result of a merger between the syndicalist USA and the socialist
COA . The FORA once again refused to join and formed its own
communist confederation, the Committee of Class and Union Unity
(Comite de Unidad Sindical Clasista, CUSC) (Di Tella 2003) .
Although the formation of the CGT brought about a unification
of the different ideological currents within the incipient labor move-
ment in Argentina, the communists, who joined the CGT in 1932,
controlled the two main unions within it: the National Federation of
Construction Workers (Federacion Nacional de la Construccion,
FNC) and the National Federation of Metallurgy Workers (Federacion
Nacional Metalur;gica, FNM) . Syndicalists were out of the picture
during the conservative dictatorship ofl930-1943, leaving the scene to
the socialists and their new foe, the communists. As a result, the CGT
was divided into two groups, led by the socialists and the communists
as early as 1942. The Railways Union (Union Ferroviaria) and the
Tramway Union (Union Tranviaria) represented the socialist faction,
also called "CGT Number One." The metal, construction, and pack-
inghouse workers represented the communist faction, also called the
"CGT Number Two ." The CGT Number One and the CGT Num-
ber Two had different political affiliations and strategies. The socialist
CGT Number One used the Socialist Party to voice its aspirations .
Meanwhile, communists were busy discussing how to establish an
independent labor party" (ibid .).
By 1942, therefore, the clashes within the Argentine labor move-
ment continued to be of an ideological nature, as they had been
in the 1890s. While the conflicts remained dictated by ideology,
however, they were now different in that they were institutionalized
under the aegis of a single labor confederation. Divided by ideology
yet unified structurally at its birth, the CGT came to be the most
important institutional hub ofArgentine labor politics. The ideologi-
cally divided workforce was awaiting the arrival of a strong leader for
unification.
The early formation of an institutional basis for labor, with the
direct initiative on the part of workers themselves, presented a very
different dynamic for the development of labor in Argentina com -
pared with that in Turkey. The CGT's equivalent labor confedera-
tion in Turkey, TURK-IS, had to wait until the 1950s to see light of
day, and even then, the initiative was not bottom-up, but top -down.
TURK-IS was founded as result of the initiatives of the United States
government and labor institutions in collaboration with the then
ruling DP. At that time, the impact of the Cold War and perceptions
of the rising communist threat were considerably stronger than in
1930, the year the CGT was formed .
Development of Labor: A Loyal Peronist Clique

The military put an end to the conservative dictatorship in 1943.
Labor unions were once again allowed to operate. The military
imposed its own restrictions, however. The CGT Number Two was
outlawed for being communist. The CGT Number One, on the other
hand, was placed under administrators appointed by the military
government instead of under elected union leaders. Peron, then an
army colonel, was appointed director of the Department of Labor
and Social Security (Departamento del Trabajo y Obras Sociales), an
insignificant department at the time of his appointment in 1943.
Initially, the military government strongly backed Peron and his
pro-labor policies. Workers were seen as a possible source of support
by the military, especially after the failed attempts at co-opting the
industrialists, who continued to long for the Radical Party's return to
power (Horowitz 1990).
Peron worked hard to empower the workers. He established a

retirement fund for commercial employees and journalists. Maximum
hours of work and minimum wages were fixed for bank employees and
sugar workers. Ten days of paid vacation per year were accorded to all
workers. Peron also improved the existing pension plans and introduced
new ones. He strived to strengthen the unions and bring them back to
political life. He presided over the signing ofcollectiveagreements as the
minister oflabor and intervened in the workers' favor during industrial
disputes. As result of his efforts, the initially insignificant Department
of Labor evolved into an independent ministry. He became the minister
of war, the provisional vice president, and the labor minister by mid-
1944. Meanwhile, the CGT Number One was transformed into the
most important support center for Peronism . Since the great majority
of labor organizations belonged to the CGT Number One, Peron had
substantial influence over almost all workers and worker organizations
by as early as 1945 .7 By that time, the rank and file looked up to Peron,
not to their union leaders, for better wages and working conditions .
They now called themselves Peronists (ibid.)
Many of the Peronist workers were tired of the constant ideo-
logical warfare that plagued the labor movement before Peron's rise.
More importantly, Peron finally gave them what they had sought for
decades, that is, better pay and significantly better working condi-
tions . Peron's extensive use of patronage networks, apparent in the
appo intment of countless union leaders to various governmental
posts, and the direct contacts of his wife, Eva Peron, with the rank
and file also helped to strengthen Peronist allegiance among union
members . Conversely, unions did not even have the right to strike at
around the same time in Turkey.
While working toward improving workers' welfare, Peron also
made sure that they became more and more dependent on him .
The first labor-related regulation, decree number 23, 852-45 of
October 2, 1945, for instance, allowed only one union per industry
in a given geographical region. This referred to the principle of
"single unionism." The government's recognition and approval were
necessary for these unions to be legitimate and for them to engage
in collective bargaining, to petition authorities, and to legally and
fully represent their members. This second principle, called the "legal
recognition" or personeria gremial, would also leave enduring marks
on the Argentine labor movement, as would the beginning of the so-
called Peronist Revolution on October 17, 1945 .
On that day, thousands of Peronist workers flooded the entrance
to the military hospital in Buenos Aires where Peron was being
detained by the military. The military had grown restless with the
increasing organization and strengthening of the working class and
the so-called Peronist movement. It had, therefore, toppled Peron.
The workers protested, demanding his release. The demonstrations
were so intense that the ruling military commander, General Eduardo
Avalos, had to negotiate with Peron so that protesters could be
dispersed. Peron's conditions for convincing the demonstrators was
the formation of a new cabinet composed of Peronists and a public
speech in front of La Casa Rosada" (Munck 1987).
Peron's October 17 speech was a tremendous success and a turning
point for Argentine labor. There are various reasons for considering
this date as a critical juncture in Argentine labor history. First, the
October protests established the workers on the political scene as
an organized group for the first time . Second, it made them aware
of their political power. Finally, in his speech, Peron announced his
retirement from the military and his candidacy for the 1946 presiden-
tial elections. Peronism from then on would render the development
of the Argentine labor movement very distinct, not only compared
with Turkey, but in the entire developing world . While Turkish labor
would embark upon a highly political and ideologically partisan labor
movement divided mainly by the left-right cleavage in 1946, in the
same year, Argentina would start off what would be a highly person-
alistic and c1ientelistic labor movement." The only divisions within the
Argentine labor structure from then on would be between the "ultra"
Peronists and the more independent Peronists, leaving little room for
the few non-Peronists.
With his election as the President, Peron made sure that only
workers and unions loyal to him could survive. Union leaders sus-
pected of having an independent streak were sacked. The usual trend
consisted of the government concocting an internal conflict in any
union thought to be disloyal. Fresh elections would then be orga-
nized immediately. The new leadership would more often than not
be Peronist since the rank and file itself was Peronist. If that did not
work, however, the main Peronist tool of manipulation, the CGT,
would intervene in the rebel union. No direct government interfer-
ence would take place since the 1946 Law of Professional Associa-
tions prohibited such interference. '
The installation of a new leadership and intervention by the
CGT were not the only ways of dealing with non-Peronist unions.
Denying or retracting the personeria gremial and using police raids
were others. The highly centralized structure of the CGT itself was
sufficient for controlling the affiliated unions . Accordingly, local
68 DEMOCRATIC INSTITU TIO NS
unions could not have any kind of fiscal autonomy. The CGT levied
a per capita tax on each affiliate in the amount of 20 cents per union
member. It also received special payments, including the wages paid
by employers to workers for paid holidays .!" It should come as no
surprise, therefore, that most un ions remained obedient to Peron by
default. The equally centralized union structure in Turkey did not
work to promote allegiance to any specific leader or ideology. It was
relatively easier in Turkey to form, and affiliate with, the labor con-
federation of one's choice . If the riddle in Argentina consisted of who
was a real Peronist and who was not, in Turkey the leading question
was how and to what degree labor unions should be allied with the
government and political parties.
While the dependency nexus between Peron and the workers grew,
so did organized labor. There were only 500,000 workers in 1946
when Peron became President. By 1948, 1.5 million worker s were
unionized (Torre and De Riz 1991, 82) . This number burgeoned
to 3 million by 1951-a unionization rate of over 90 percent. The
new constitution Peron promulgated in 1949 contained the article
"Rights of the Worker," which included, among others, the right to
work, training, decent working conditions, welfare, social security,
economic improvement, just remuneration, preservation of health,
protection of families, and defense of professional interests. This
period in Argentine labor history was dubbed the "golden age" of
state and union cooperation (Halperin 1983, 105).
The dependency nexus forged by Peron was not able to prevent
the emerging troubles of the early 1950s, however. The worsen ing
economic conditions, bad harvests due to drought, and the death of
Eva Peron, who was very close to the rank and file, were significant
in eroding Peron's popularity. The last straw was Peron's decision
to privatize the state petroleum company, Yacimientos Petroliferas
Fiscales (YPP). In June 1955, Peron said, "The Peroni st Revolution
has ended. I cease being the head of the Peronist Revolution and
become the president of all Argentines now" (Alexander 2003,104) .
This could not, however, prevent his overthrow by the military in
September 1955.
If there was only one explicitly anti-labor military coup in Turkey,
that is, the final 1980 military intervention, in Argentina, there were
three. The first one, the 1955 military coup, known as the Liberating
Revolution (Revolucion Libertadora), was targeted at weakening
the Peronist labor movement and the increasing power of unions.
Thousands of Peronist leaders were arrested and jailed. Military men
were appointed to the CGT and its affiliate unions as interventors.
The principle of "single unionism" was abandoned so that more than

one union could operate in a given sector.
This coup against Peron also sowed the seeds for the enduring
structural fragmentation of the Argentine labor institutions along
those who were for and against Peron and Peronism. The question of
what to do about Peron split the organization into three different fac-
tions by 1957. The 62 Organizations controlled by Peronists, the 32
Democratic Organizations led by anti-Peronists and anti-communists,
and finally, the 19 Unions of the Communists. The last two organi-
zations were not long lived, but the 62 Peronist Organizations sur-
vived, as the core of the underground CGT, for more than a decade
following the 1955 coup. Overall, the coup failed to depoliticize or
weaken the labor movement as it had set out to do . On the contrary,
if anything, it rendered it more Peronist over time, as reactions to the
curtailing of freedoms grew more and more powerful.
In spite of deep ruptures over the nature and degree of allegiance
to Peron, Argentine labor unions tried to achieve some degree of'uni-
fication after the 1955 military intervention. The 62 Organizations,
along with some independent unions, were able to come together
to revive the CGT in 1961. The confederation was restored to its
full legal status in 1963 . The CGT asked for the freeing of political
detainees, restoration of the personeria gremial, the participation
of workers in economic decision making at the governmental level,
an increase in wages, the decrease of taxes, the end of petroleum
contracts with foreign firms, freedom of speech, and the protection
of SOEs . These demands were not met. As a result, the CGT grew
increasingly militant (Torre 1988).
Not everyone within the CGT was happy about the militant course
of action undertaken by its leadership . The independent unions
within the CGT favored a more conciliatory approach toward the
non-Peronist government of Arturo Umberto Illia, which succeeded
the military in 1963 . Soon, a second split occurred within the CGT
when independent unions seceded from it by 1964. The remaining 62
Organizations also contained a plethora of voices internally : (1) those
who wanted to strictly follow Peron and his directives, (2) those who
wanted a labor party that would consult informally with Peron, and
(3) independents and communists. Clearly, this picture was starkly
different from that of the Turkish labor movement, in which, by
1964, the CGT's counterpart, TURK-IS, was far from being divided
over the question of allegiance to anyone or any specific ideology. On
the contrary, the leadership of the Turkish labor confederation was
united around the well-functioning doctrine of PAP. I I
70 DEMOCRATIC INSTITUTIO NS
Despite the divisions in the Argentine labor movement, the

military was still not convinced that Peronism had ceased to pose
a threat; hence the 1966 coup, called the Argentine Revolution
(Revolucion A1;gentina) . General Juan Carlos Ongania's main anti-
labor tool was economics: he rejected populism as a possible course
of action . Instead, he adhered to laissez-faire economics with the ulti-
mate aim of eliminating inflation . He suspended all political activity
arguing that politics interfered with efficient allocation of resources.
From 1966 to 1970, membership in all of the most important
unions-the Railways Union (Union Ferroviaria), the Metallurgical
Union (Union Obrera Metalu1;gica), the General Confederation of
Commercial Employees (Confederacion General de Empleados de
Comercio), the Workers Association of Textile (Associacion Obrera
Textil)-declined. At the same time, the rank and file, supported by
student groups and leftist organizations from the middle class, grew
more and more radical (Godio 1991).
The CGT again experienced splits after the 1966 coup. This time,
the splits were over the relationship between labor unions and the
military dictatorship . By the end of 1967, there were three main fac-
tions within the CGT: (1) those who wanted full collaboration with
the military, (2) those who favored dialogue but no formal agree -
ments, and (3) those who rejected any kind of contact with the mili-
tary government. The first group did not have any connection with
the two other CGT factions and was eventually isolated . The second
and third groups, respectively, were called the CGT-Azopardo and
the CGT-Paseo Colon. Not long after the coup, the military shut
down the CGT-Paseo Colon.P (ibid .)
The end of Ongania's regime came with the 1969 Cordobazodisaster.
This was the civilian uprising, by worker and student groups, against the
military and its economic policies.The Cordobazo led to the formation
and strengthening ofother socialmovements, including the anti-military
and Peronist guerilla movement known as the Montoneros.V Following
the Cordobazo, the military overthrew Ongania, who was succeeded by
General Roberto Levingston and General Alejandro Agustin Lanusse,
successively. General Lanusse opened the political arena to Peronists
once again. Hector Campora, representing Peron, who was still in exile
in Spain, won the 1973 elections against the Radical candidate Ricardo
Balbin. Campora thus became the second Peronist president since
Peron's overthrow in 1955 (ibid.).
Campora's term in office was rather short. After only 49 days,
Peron returned from exile to replace him. Once President again,
Peron undertook to reinvigorate the dependency links with the
traditional union leaders. To this end, he first repudiated the new-

comers to Peronism. Students and the independent Peronist youth
organizations as well as leftist intellectuals were banished. Peron then
worked to strengthen the top trade union bureaucracy by authorizing
it to remove local union leaders and shop stewards deemed unfit. He
also extended the national union leaders' terms in office from two
to four years. Reports on union finances were now required every
other year rather than annually. These and other measures helped
forge closer relations between the union leaders and the Peronist
government (Bonasso 1997).
Upon Peron's death in July 1973, union leaders were once again
confused regarding the nature and extent of their ties with Peronism
and the future of the labor movement: some unions advocated total
submissiveness to the Peronist political movement, while others,
like the 62 Organizations, opted for a more cautiously independent
unionism. At the end, the second group of unions prevailed. The
victory of the 62 Organizations was greatly helped by the inepti-
tude of the new government, led by General Peron's second wife, in
dealing with soaring inflation . It was thus not Juan but Isabel Peron
who precipitated the third military coup-the National Reorganiza-
tion Process (Proceso de Reorqanizacion Nacional)-on March 24,
1976 (Ramos 1981).
This coup led by General Jorge Rafael Videla and his subsequent
regime brought about a much more vigorous restructuring of
Argentine politics, society, and economy than the previous military
interventions against Peron and Peronism. Termed the "Dirty War,"
this period (1976-1983) involved the militarization of all sectors of
society and the elimination of basic rights and freedoms in all domains
and spaces, including political, social, economic, and public and pri-
vate spheres . Labor was one of the most affected sectors in this ordeal:
the military government suspended all trade union activity, including
strikes. Anyone suspected ofleftist leanings risked persecution. Thou-
sands of Peronist leaders of all ranks were kidnapped and killed. The
government could intervene in all aspects of unions' internal orga-
nization. No union could extend beyond the Federal Capital, or the
limits of an individual province, which equaled a de facto prohibition
of all federations . Unions' social welfare functions were eliminated,
while their funds, bank accounts, and property were seized by military
interventors. The CGT itself was ultimately dissolved, once again, on
November 12, 1979 (Munck 1987).
Direct attacks on individual rights by the military were coupled
with the indirect effects of the harsh economic policies adopted.
The minister of economy, General Jose Alfredo Martinez de Hoz,

freed all prices and exchange rate, froze wages, decreased tariffs, and
annulled protections in the manufacturing sector. It is estimated
that one million workers lost their jobs between 1975 and 1980,
decreasing the numbers of the Argentine working class from six to
five million (Abos 1984, 73) . While Martinez de Hoz became the
anti-labor figure par excellence in the minds of the Argentine rank
and file, there was no equivalent military figure for the Turkish work -
ers to name as the foe of labor, nor was there any political figure like
Peron whom they could point to as labor's savior. The Turkish mili-
tary's minister of economy, Turgut Ozal, was in fact a relatively liked
figure. It is true that he was associated with belt -tightening policies,
but his legacy also reverberated with political liberalization and civic
freedoms . This is because Ozal , in contrast to de Hoz, formed his
own political party and distanced himself from the military. The
relatively milder and much shorter Turkish military intervention in
1980 compared with the prolonged Argentine Dirty War also might
have helped assuage the Turkish workers' negative feelings toward
neoliberalism, the military, and their connection and association with
one another. This was not the case in Argentina.
Despite political and economic tribulations, nonintervened and
relatively smaller local unions from the interior began reorganizing
the labor movement as early as 1977. They came together to form the
Committee of25 in March 1977. This committee initiated a wave of
strikes and walkouts in November 1977. Some of its members estab-
lished the Peronist Union Movement (Movimiento Sindical Peronista,
MSP), which was a revival of the 62 Organizations. A second unof-
ficial trade union group that sprang up during this period of resis-
tance was the Commission of Administration and Labor ( Comision de
Gestion y Trabajo, CoGT), formed by labor unions active in the metal,
commerce, textile, telephone, and railroad sectors . Shortly after its
foundation, the CoGT changed its name to the National Labor Com-
mission (Comision Nacional del Trabajo, CNT). The CNT favored
dialogue with the military regime in order to secure changes in labor
policy. As opposed to the CNT, the Committee of 25 rejected any
cooperation with the military (Munck 1987).
As labor resistance was building against the military dictatorship,
economic difficulties were also mounting. Escalating debt, mainly
due to excessive military spending and the artificially high value of
the Argentine peso as well as the inefficient SOEs run by corrupt sol-
diers, contributed to the rising budget deficit. The military could find
no solution other than fabricating the crisis of the Malvinas Islands
in order to take the social pressure off of itself. 14 The Argentine

armies invaded these British-controlled islands on April 2, 1980, with
the premonition that the patriotic flurry of war would replace the
roaring civil unrest and labor discontent. Things did not turn out as
planned, however. The Argentine armies were badly defeated by the
British, this only stepping up Argentines' frustration with the military
dictatorship.
The War of Malvinas was especially important for labor since the
disaster led to the unification of the previously promilitary CNT and
the anti-military CGT. Now called CGT-Azopardo and CGT-Brasil,
respectively, the two labor confederations collaborated for the first
time in the staging of the national general strike of December 6,1982 .
In addition to the strike, CGT- Brasil held a massive demonstration
known as the "March for Democracy" on December 16,1982. Such
strikes and protest movements became crucial destabilizing forces for
the military regime in the 1980s (Haas 1987,8). Pressure from labor
unions was an important factor influencing the military government's
decision to call for free elections on October 20, 1983.
The 1983 elections were the first free and fair elections in which the
Peronists lost after participating without restrictions . Raul Alfonsin of
the Radical Party won the elections against the Peronist union leader
Lorenzo Miguel of the UOM. Alfonsin's impressive work with regard
to Argentina's transition to democracy did not register the same amount
of success in his relations with the labor unions, however. Labor stayed
Peronist, while the main supporters of the Radicals continued to be
the national industrialists. Alfonsin's inability to deal with the economic
chaos certainly did not help to bring labor on to his side. By 1984,
inflation had rocketed to 566 percent yearly. Nor did his proposed
labor reforms succeed in democratizing the internal workings of unions
or in bringing them under tighter government control. 15 Successive
failures in the political and economic domains caused Alfonsin to
resign in 1989, six months before the end of his official term .
Internal clashes within labor resurged with Alfonsin's election
and multiplied with his controversial labor policies. There was the
militant wing of the CGT, led by Secretary-General Saul Ubaldini,
which supported the use of work stoppages, protests, and demonstra-
tions against the government. Support for the Ubaldini faction was
stronger in the upper levels of union leadership than among the rank
and file. Militant rhetoric notwithstanding, this group maintained
amicable relations with the business sector, especially the Industrial
Union of Argentina (Union Industrial A'Qjentina) VIA), as well as
the Catholic Church and the military (Gonzalez and Bosoer 1990).
There were many other factions within labor in the 1980s besides
the one led by Ubaldini. A second splinter group, called the "11
faction," was a small corporatist alliance forged between some CGT
leaders, the Argentine Rural Society, and big businesses within
the UIA. A third group, called the New 25 Group, supported the
Renovating Peronist Party, a faction within the PI led by Antonio
F. Cafiero, the Peronist governor of Buenos Aires. The Renovating
Peronist Party and the New 25 Group aimed at democratizing the
workings of the PI and ousting the Radicals. The still-existing 62
Organizations comprised the fourth group. Composed, this time, of
the old-line union bureaucracy and the paternalistic trade unionists,
they thrived in the UOM as well as unions operating in the sectors
of petroleum, light and power, meat packing, and healthcare. Their
perspective was corporatist, guided by a liberal-capitalist ideology.
Finally, the Group of 15 was an alliance built among some members
of the 62 Organizations, the New 25 Group, and the UOM in March
1987 (ibid.) .
As shown in the myriad divisions within the CGT along different
understandings and degrees of Peronism and the associated question
of the type and level of cooperation with the non-Peronist military,
the Argentine labor movement developed along more complex and
controversial lines than the Turkish labor movement. Loyalty to one
man and his ideas dominated and determined the evolution of the
Argentine labor force for decades . While Peronism was strong in
the union leadership, its strength and meaning were quite different
among the rank and file. For generations, workers talked their sons
and daughters out of becoming workers, although they themselves
were Peronists. Dr. Osvaldo Battistini, a researcher at the National
Council of Scientific and Technical Research (Consejo Nacional de
Investigaciones Cientificas y Tecnicas, CONICET) and a professor at
the University of Buenos Aires, says
My father, a Peronist worker, wanted me to become an engineer, a

doctor or a businessman . He did not want me to follow him in his
footsteps as a worker. He wanted me to be my own boss. Many workers
dreamt of putting up the ir own businesses. 16
(Buenos Aires, June 2006)
Peronism, therefore, was a tool of political strategy that belonged to

the ranks of the political elite (Heymann 1991). And with time, there
were as many Peronisms as there were members of the political elite,
including individual union representatives and politicians, but with
the exception of the overtly non- Peronist Radicals. As one union

representative put it,
Peronism is more like a mystical religion. We all feel compelled to

adhere to it in one way or another emphasizing some of its tenets,
while downplaying or entirely discarding the rest. Some do it to obtain
benefits, and some byconviction. Of course,the two are not necessarily
mutually exclusive of each other. That is why it is safe to say that most
Argentines are Peronists without being the exactsame thing at all.'?
There was no equivalent political figure who had left his marks and
ideas on the Turkish labor movement. The founder of the Turkish
Republic, the only man who had a comparable impact in Turkey,
never targeted labor or any other specific class to build his political
power or to advance his project of state and nation building. Kemal-
ism in Turkey was about political and economic modernization, with
particular emphasis on secularism. On the socioeconomic plane, the
main goal was the creation of a national middle class and not the
empowerment of the working class. Peronism, on the other hand, was
concerned with the creation and strengthening of a nationalist work-
ing class loyal to Peron himself and to his project of corporatism.
Labor union leaders were less important in Turkey than in Argentina.
While partisanship was a reality for the largest labor confederation,
TURK-IS, PAP was in no way comparable to Peronism. PAP was
a doctrine about following every kind of government in exchange
for favorable policies, mostly economic benefits obtained during
collective bargaining. Peronism, a unifying ideology and national
identity, was also that but involved so much more. Peronism came to
be equated with emotional ties and loyalism to one man and his ideas.
Peronist union leaders were directly in touch with their corporatist
allies in the Peronist governments. In Turkey, perhaps except for a
brief period in the 1970s, governments almost always dominated over
the union leaders, who, then, controlled the rank and file.
Restructuring of Labor:Tripartite Division

of Unions by Privatizations
Following the transition to democracy in 1983, Alfonsin's radical
government focused primarily on the issue of human rights and
punishing the military for the atrocities committed during the
preceding dictatorship. Although combating the hyperinflation and
initiating the privatizations process were among the economic objec-

tives of the first democratic government of Argentina, Alfonsin failed
to achieve the first objective and did not implement the second.
Alfonsin's motto was "With democracy, one can eat ." Economics
proved him wrong (Panizza 1993).
With the election ofPeronist Carlos Menem in 1989 as Argentina's
President, a new era started in Argentina. Despite his populist rheto-
ric and promises of salariazo,I8 once President, Menem initiated the
most orthodox restructuring program ever seen in Argentine history.
His restructuring program started with two emergency laws. The first
one was the Law of Economic Emergency, which decreased subsidies
to the SOEs and reduced public employment by attrition. The second
was the State Reform Law, which initiated the privatization of a large
number of SOEs, including the telephone, airlines, railway, oil, and
coal companies, electric firms, water services, postal service, ports,
and the Buenos Aires subway system. During the first year and a half
of Menem's administration, 60,000 government employees were
dismissed (Alexander 2003, 210) . The unemployment rate reached
18 .6 percent by 1995. Privatizations were the main culprits for the
dismissals (Novick 2000, 55) .
Before Menem, the Argentine model of labor relations was based
on state corporatism in which the state was the de facto and de jure
arbitrator between business and labor. Unions had an important role
in this power arrangement, especially with respect to wages, which
were constantly negotiated according to the expected rate of infla-
tion and the associated cost of living (Tomada and Rigat 1999). This
was also a system based on long-term employment, with significant
revenues for the unions . Two levels of union representation, with little
contact between themselves, existed: the bottom-level representation
at the firm level by the internal comm ission of delegates and the top-
level representation by the national union confederations (Novick
2001, 27). Solidarity among workers sprang more from the top -level
union representatives and their role as providers ofsocial services, such
as access to education, housing, health services, and vacation days
to the members . Labor scholars writing on this period complained
that unions had become more like service-lending agencies than
organizations representing workers' interests (Rosanvallon 1988).
Menem introduced a decentralized system of collective bargaining.
Instead of the traditional industry-wide collective agreements, he
promoted labor-management negotiations at the individual plant
level, thus depriving labor of its power to disrupt entire sectors in case
sector-wide collective agreements failed. He also attempted to lessen
Table 3.1 Deputies of union background in the Argentine House of Congress

(1983- 1995)
Deputies of Union 1983- 1985- 1987- 1989- 1991- 1993-

Background 1985 1987 1989 1991 1993 1995
In numbers 35 28 26 23 18 10
As a % of the total 13.80% 11.0% 10.2% 9.0% 7.1% 3.9%
number of deputies
Source: Compiled from Centro de Estudios para la Nu eva Mayoria cited in Gonzalez (1996 , 202 )
and in Bambaci, Saront, and Tommasi (1999, 32 ).
the unions' role in administering the country's social welfare system,

known as obras sociales, while strengthening that of the government
and the private agencies.'? The number of labor leaders elected
to the Chamber of Deputies in the 1991 election was only half of
that elected in 1983 (Cardoso 2004) . The decreasing trend in the
numbers of deputies with union background in the Argentine lower
chamber can be seen in table 3.1.
Menem also canceled the indexation of wages to inflation . Instead,
he linked wage increases to increases in productivity in any given firm
(Novick 2001,32) . Accordingly, national labor union leaders would
no longer deal with employers for questions of wage increases or
working conditions. Local union leaders would do that in individual
firms. Between 1991 and 1994, 62 .5 percent of collective agreements
signed between capital and labor were by sector. Between 1995 and
1999, this percentage dropped to 23.3 percent. In the same period,
76.6 percent of agreements were signed in individual firms by local
union leaders. This shows that the local union leaders and internal
commissions had a new, powerful role in representing the interests
of the rank and file in the global era. The decreasing pattern in the
number of sector-wide collective agreements and the increasing pat-
tern in the number of firm-based collective agreements can be seen
in table 3.2.
One of the most important tools Menem used to reshape labor was
the privatization of the SOEs . Privatizations rendered the workforce
and labor disputes more heterogeneous (Novick 2000,58). Unions,
which participated extensively in the new decentralized and dynamic
collective bargaining, operated in the privatized sectors, that is, the
automotive, petroleum, railroad, gas, water, and electricity sectors
(Tomada 1999) . Hector Palomino and Cecilia Senen Gonzalez
(1995) described the new labor relations of the global era as a con-
tinuously changing amalgam of subsystems of sectors, unions, and
firms. In other words, with privatizations the single institutionalized
Table 3.2 Revisions of collective agreements in Argentina (1991- 2001)
Scope
Year Activity Sector Firm TOTAL

1991 38 41 18 97
1992 109 56 44 209
1993 88 39 91 218
1994 77 21 104 202
1995 67 4 125 196
1996 31 14 107 152
1997 31 10 167 208
1998 28 2 189 219
1999 28 4 152 184
2000 12 0 64 76
2001 22 0 128 ISO
2002 27 181 208
2003 56 338 394
2004 Il2 236 348
2005 203 365 568
2006 278 494 772
TOTAL 1207 191 2803 4201
Source: Argentine Ministr y of Labor, Employment and Social Security.
Note: For data after 2002, due to availability, the activity and secto r variables were combined and
put in the activity column.
system of business-labor relations ended. The previously centralized

labor institutions and the clientelistic relations between the unions
and the state were gradually replaced with what resembled a "social
dialogue," which consisted of consultations and negotiations between
more independent unions and a more independent state (Cardoso
2004, iii).
Privatizations also changed the nature of the workforce . A new
type of contractual hiring, spurred by and for privatizations and
sanctioned by the Law of Labor Contracts (Ley de Contratos de
Trabajo), made outsourcing legaPO Downsizing and rationalization
significantly increased unemployment levels, which reached a record
high ofl8 .6 percent in 1995 (Fraga 2001) . Most of the unemployed
were so by "exclusion," meaning that their lack of skills made the
likelihood of their returning to job markets in the future very low.
The size of the informal workforce, therefore, grew rapidly-rising
HISTORY 0 P LABOR D EVELO PMENTS IN ARGENTINA 79
from 17 percent in 1975 and 18.7 percent in 1980 to about 35

percent toward the end of the 1980s and more than 50 percent by
the end of the 1990s (Rosales 2007). The level of informal workers
as of 2004 was estimated to be at a record high of 60 percent (Whit-
son 2007) . Those who continued to be employed in the formal job
market, on the other hand, received dwindling social benefits . The
decline in social coverage was accompanied by increasing poverty:
household income decreased by 51 percent between 1974 and 1990
and by 32 percent between 1994 and 1997 (Minujin 1999).
Despite serious discontent against attempts at similar policies by
Alfonsin, not a single general strike had taken place against Menem
and his neoliberal policies by 1991. One reason for any lack of reac-
tion on the part of labor might have been the rapid and secretive
way in which policies were made. Technocrats worked behind closed
doors and in cooperation with international agencies (Dominguez
1997, 3) . Moises Nairn (1995, 31) described this secluded way of
policymaking as "chemotherapy" and contrasted it with a more grad-
ual and consensual approach of economic restructuring.
The second possible reason why Argentine labor was unable
or unwilling to react to Menem's policies right away was that it
had partisan connections with, and an allegiance to, the Peronist
government. The fact that the Argentine labor unions did not miss
one opportunity to react to Radical Alfonsin's privatization attempts
supports the validity of the hypothesis that partisanship was a plau-
sible explanation for the delayed mobilization against privatizations.
The lack of identical partisan nexuses in the case of the Turkish labor,
which also demonstrated a protracted period without any reactions
to privatizations, suggests that there might be another and a stronger
explanatory factor for labor's response to privatizations.
The explanation lies in the fact that labor, like many other sectors
of society in both Turkey and Argentina, wanted and acquiesced to
privatizations initially. The growing consensus toward the end of the
1980s in Turkey was that privatizations were necessary to eliminate
the inefficient and corrupt SOEs . Argentines were so afraid of infla-
tion soaring back again that anything was preferable to the Alfonsin
era of hyperinflation, let alone privatizations. Menem's honeymoon
period also helped create this positive outlook. Finally, Menem's cha-
risma and his effective use of patron-client relationships were decisive
in buying labor's support. This was similar to Ozal's astute coalition-
building strategies in Turkey (Acar 2002).
Although apathetic at first, Argentine labor underwent new divi-
sions as a result of these revolutionary changes in industrial relations .
80 DEMO CRA TI C INSTITUTIONS
The new culprit for the ruptures within the CGT was now Menemism,
epitomized by its privatizations of the SOEs. The CGT-Azopardo led by
Ubaldini retained its militant posture and refused to take part in privati-
zations. Its counterpart, the CGT-San Martin led by Guerino Andreoni,
was amenable to compromise. Despite their differences, the two CGT
factions unified in 1992 to oppose the planned reform of social security
(Gonzalez 1996,78). This unification was followed by a new split a few
months later: Some of the more militant unions in the CGT-Azopardo
abandoned the CGT altogether, forming the CTA in 1992 .
The CTA was distinct from the CGT in its strategies, principles,
and organizational structures. It claimed to repre sent all workers
regardless of whether they were CTA members or not. The CTA
resembled more an association based on social support and commu-
nity networking than a labor confederation in the traditional sense.
It included NGOs, human rights organizations, intellectuals, social
and professional researchers, and artists in its board of directors.
The CTA even granted membership to the unemployed, the retired,
housewives, and prostitutes. It was supportive of the movement of
worker-occupied factories and enterprises (Ranis 2005) . Adhesion
to the eTA was more of an ideological affiliation rather than an
instrument for collective bargaining. The CTA thus pursued a type
of unionism that was more autonomous of the state, political parties,
and businesses, and geared more toward research , development, and
mobilization of the labor force (Novick 2001,38--40) .
Another rupture occurred in the CGT in 1993. The so-called
Argentine Workers Movement (Movimiento de Trabajadores de
At;gentina, MTA) was composed mainly of transport, construction,
metal, and metallurgy workers . Initially, the MTA very much mir-
rored the CTA in its discourse and programs. Both the CTA and the
MTA refused to take part in privatizations and recommended that
their members not participate in the privatized social security system
(AfjPs).21 The MTA joined the CTA in militant opposition against
Menem's neoliberal government on various occasions. It also orga-
nized various protest movements taking a firm stand against foreign
debt and social inequalities . Like the CTA, the MTA also strived
to incorporate a multitude of social groups within its institutional
boundaries (Fernandez 1998).
The MTA's essence, however, remained confined to the traditional
Peronist credo of more state intervention and protection for the well-
being of workers. As opposed to the CTA, the MTA encouraged par-
tisanship with, and subordination to, the Peronist Party (Novick 2001,
40) . When the MTA's populist leader, Hugo Moyano, was elected as
the CGT's secretary-general in 2005, the MTA was virtually dissolved,

and the CTA was left as the only alternative to the official CGT. As
for Moyano, along with Jose Pedraza, the leader of the Menemist
Railways Union (Union Ferroviaria, UF) and Chinese and Canadian
investors, is now a buyer in the privatization of Belgrano railways.F
CONCLUSION: THE ARGENTINE

LABOR MOVEMENT TODAY
The Argentine labor movement is much older, stronger, and institu-
tionalized than its Turkish counterpart, in which top-down restruc-
turing oflabor relations seems to be more prevalent and pronounced.
Both empowered and weakened by its Peronist heritage, the Argentine
labor history was driven first by ideological then by Peronist discourse
and cleavages. The economic and political changes introduced by
Menem between 1989 and 1999 have transformed the Argentine
labor movement in specific ways. Until the 1980s, the Argentine
labor movement was characterized primarily by (1) a dominantly Per-
onist and state corporatist system based on closed-door patron-client
dealings, (2) lSI and a closed economy, and (3) the lack of a nonparti-
san and autonomous labor union movement. The profusion of SOEs
contributed immensely to the maintenance of these characteristics.
The worker, whose employer was the state, failed, or simply opted out
of acting as a political animal, for the reasons that (1) he was part of
the tradition of Peronist-style populism and benefited from it and (2)
he took it for granted that as long as the Peronist party was in power,
not only would his basic needs be taken care of, but there was even
a chance for him to climb the ladder within the union hierarchy to
obtain a management position within the SOE and possibly a place
within the Peronist party. Menem's restructuring of the economy via
privatizations shook this historical pattern and thus marks a critical
juncture in shaping the developmental pattern of the labor movement
in Argentina.
The three ways in which the Argentine labor institutions have
changed in the 1990s can be summed up as follows:
Political Unionism: This refers to a political strategy of continuity of
loyalty between Peronism and Menemism adopted by the CGT-San
Martin . While Peronism in the 1950s was about the nationalization
of foreign-owned firms and sectors, Menemism was about the priva-
tization of these very same places. All the same, the Menemist state
employees' union (Union of the Civil Personnel of the Nation,
UPCN), water provision workers, chemical workers, meatpackers,

textile workers, construction workers, pasta industry workers, life-
guards, railroad workers, and state oil workers, who constituted the
San Martin branch of the CGT, preferred using privatizations as a
tool to obtain economic and political perks. In exchange for its loyalty
and consent to privatizations, the CGT-San Martin kept its monopoly
on the provision of social security to its members and other worker
groups. It also obtained various political posts and the opportunity
of firsthand dialogue with the privatizing government in order to
minimize the possible damages to its membership body.
The strategy of political unionism was to refuse any direct and
explicit involvement in privatizat ions while at the same time avoiding
an openly anti-privatization stand. The justification for this strategy
was that there was no other way but to privatize the economy in order
to save it from its endemic crises. As such, the traditional clientelist
partisanship dealings with the Peronist party were now adapted to the
era and new requirements of privatizations. The exchange of patron-
client benefits was now done on more neutral and professional terms,
thereby adopting what can be called a "culture of professional com-
promise." While as clientelist as before , the culture of professional
compromise involved a socioeconomic justification of privatizations
and thorough and open -door negotiations on their terms.
Economic Unionism: This refers to the active involvement in
privatizations of a group of previously independent unions with in
the CGT. Relatively large and financially well-off unions in the
sectors of electrical energy, oil, reta il, automobile, and metallurgy
acquired organizational autonomy by expanding their services to
segments of society other than just their members. They purchased
firms in their respective sectors, created and administered private
social security accounts, provided health care insurance to members
and nonmembers, established firms that hired their downsized mem -
bers to provide goods and services to private firms, and managed
the employee-owned stocks of privatized enterprises (Murillo 1997,
86) . As such, this group of unions created the kernels of what can
be called a "culture of business unionism." Business unionists were
managers and union leaders, just as their affiliates were shareholders
and workers simultaneously. They actively participated in negotia-
tions with the government to change the conditions of privatization
transactions, and not the privatizations themselves .
Ideo-intellectual Unionism: The CGT remained as the representa-
tive of the most favored workers by privatizations, such as those in
the sectors of auto-making and petroleum . The unifying po int among
them all was that to one degree or another, they all espoused capitalist
solutions to the restructuring problems brought about by privatiza-
tions . The CTA, on the other hand, defied traditional unionism
shrouded within the professional rhetoric of compromise while
rejecting business unionism for its participation in the privatizations
against workers' interests. The CTA adopted a clear and consistent
anti-privatizations outlook (Murillo 1997,82-83), thereby adopting
a "culture of confrontation." While the MTA was also part of this
culture at the outset, it moved from confrontational to business
unionism upon its leader's election as CGT's secretary-general.
In addition to these distinct yet mutually inclusive identities,
Argentine labor confederations and the labor movement as a whole
contributed to the democratization of the Argentine labor and
political systems in the 1990s by virtue of (1) the CTA's explicit sup-
port of the democratization project and its clear stand against
attempts at reversing it; (2) the CTA's formation of extensive links
with civil society and international research organizations; (3) a cau-
tious but gradual collaboration at the regional level, such as the
CTA-affiliated DOM ofVilla Constitucion, the CGT-affiliated DOM
of Rosario, and other CGT-affiliated unions against privatizations in
San Nicolas; (4) the formation of a new labor leadership at the local
level comprising less ideological, more pragmatic, better educated,
and more passionate union leaders; and (5) a stronger participation
of local union leaders in collective agreements, and an increase
in their power to determine the destiny of members at the plant or
local level.
Argentine labor unions still have a long way ahead to become full-
fledged actors in democratization. Some of the unfinished tasks await-
ing the Argentine labor movement can be summarized as follows:
(1) Overcoming the political barriers dividing the confederations
to enable more active cooperation between them and with other
governance actors; (2) Democratizing the internal functioning of
the unions by publishing regular reports about election procedures
and by ensuring the turnover of top leadership; (3) Narrowing
the gap between the rank and file and the union and confederation
representatives by adopting a more civic, as opposed to a clientelis-
tic, approach to union governance; and (4) Making the system of
revenue collection and spending more transparent.
Why did similar changes occur in the post-1980 period and
accelerate in the 1990s in Argentina and Turkey? One possible expla-
nation is the increasing isolation of the workers and unions amidst
soaring unemployment, deunionization, and outsourcing-all of
these factors being direct upshots of privatizations. The other poten-

tial account for why parallel structural changes occurred in the labor
movements in Argentina and Turkey from the 1990s onward is the
changed stand of the neoliberal governments toward labor, which
then ignited the transformation of the unions. In any case, privatiza-
tions seem to be part of the reasons for the changed course of action
adopted by labor institutions. The next two chapters review the priva-
tization experiences of Turkey and Argentina and attempt to identify
the causal mechanisms that operate between privatizations and the
changing labor movements in these two countries.
CHAPTER 4
TURKISH LABOR IN THE GLOBAL ERA l
AUTONOMOUS UNIONS AND

TRANSIENTLY UNIFIED WORKERS
Effects of privatizations on Turkish labor unions and workers have

been manifold. Each one of the three major labor confederations
has taken a separate and distinct approach toward privatizations,
thereby differentiating and redefining their respective identities and
roles in the Turkish political system. Privatizations have also gener-
ated an increase in stateness, defined as the "capacity of the state to
specify the terms of economic interaction, to extract resources, and
to centralize administrative procedures and coercive means" (Schamis
2002, 192). While labor unions were relatively strong in the period
ofstate-led economy in the pre-1980 period, their political power has
dwindled along with and as result of the privatization of SO Es where
union leaders exercised influence in decision making.
Unions, as the main clients of a quasi-socialist "Father State," com-
pensated for their loss of political power by adopting a more active and
civic type of unionism, conducting social and economic research on
privatizations, engaging in less violent, more creative, and diverse types
ofsocial protest, and employing a more professional and less ideological
styleofnegotiation with the reforming governments and private employ-
ers. Parallel to these changes, unions also demanded, for the very first
time, the democratization of the political system using privatizations as a
scapegoat in the case ofsome unions, and as a window ofopportunity in
the case of others . DISK, for instance, vilified privatizations as the main
enemy of political development and started a campaign of democratiza-
tion against privatizations. TURK- IS complained about privatizations
while using them as the main tool for dissemination of, and access to,
information. HAK-IS, on the other hand, openly supported privatiza-
tions to embark upon its project of reforming an overarching state.
While privatizations did not seem to have significantly altered the
internal workings of unions as of 2005 , they might have played a role
in the rise of a new type oflocal union leader. The new union leader, at
the local level, was typically more educated, younger, more pragmatic,
less ideological, and more ambitious . He understood that in a world of
either potential or actual privatizations, union representatives needed
to be aware of their plants' productivity levels and the financial markets
and to keep track of the value of workers' shares in privatized enter-
prises. The new union leader strived to be an equal interlocutor of the
employer, to understand his language, and to respond to it in ways that
best protected workers' interests in a global and competitive world .
The effects of privatizations on individual Turkish workers are com-
plex. This research has shown that the majority of the relatively older
workforce has chosen to employ individual or family networking solu-
tions to deal with the negative consequences ofprivatizations, such as the
loss of a job or downgrading in one's position. The relatively younger
and more educated workers have chosen to mobilize and engage in
collective solutions in order to secure jobs in the formal market. Still a
substantial group of workers has opted for partisan solutions in dealing
with the adverse effects of privatizations by using their party affiliation
to obtain jobs in the post-privatizations period . Overall, privatizations
have not had a significant impact on Turkish workers' socialand political
levels ofactivity, which has continued to be determined mainly by where
they situated themselves on the left-right political spectrum. Privatiza-
tions, however, have led to temporary mobilization by the younger and
more educated rank and file, who have demanded restitution, some-
times against the will of their union and union leaders.
It is somewhat surprising to observe that privatizations' impact on
income level and social class has not translated itself into changing
patterns or level of political activity for those affected by them. The
reasons for this paradox might have to do with what privatizations are
and how they are applied. The first part of this chapter therefore treats
the definition of privatizations and their implementation in Turkey.
The second part attempts to link privatizations to the changing struc-
tural features of the Turkish labor movement. The third section deals
with the impact of privatizations on individual workers and how they
have tried to cope with privatizations. As such, the chapter attempts to
locate the causal mechanisms that operate between privatizations and
the changes observed in the Turkish labor force and institutions.
TURKISH LABOR IN THE GLOBAL ERA 87
THE BACKGROUND OF PRIVATIZATIONS:

THE PRE-PRIVATIZATIONS PERIOD IN TURKEY
As in most of the developing world, Turkey applied lSI policies in

the period from the 1960s to the 1980s. These inward-looking devel-
opment strategies consisted of import controls such as high tariffs,
quantitative restrictions, and import licenses. The reasoning behind
adherence to lSI was the indispensable need to become self-sufficient
as a country. Coupled with Keynesianism as the guiding economic
template of the times, the lSI was taken as more than a mere economic
development strategy in Turkey. Although probably less forceful than
the Prebisch doctrine in Latin America, Turkey adopted the French
model of economic development called etatisme (statism).
Statism can be defined as a form of interventionist economic policy
involving a multitude of public enterprises. After the crumbling of
the centuries-long Ottoman Empire and the devastation caused by
the consecutive World War I (1914-1918) and the Revolutionary
War (1919-1923) against the Allied Forces, Turkey was born as a
parliamentary republic with very little infrastructure or capital. Stat-
ism was a tool of the nascent state to help forge all these necessary
ingredients and build an economy from scratch." As such, it was also
viewed as an indispensable condition for forming an independent and
a strong state, with a leading role in the mobilization and allocation
of resources (Shaker 1995).
Statist ideology was also a natural upshot of the patrimonialist
legacy of the Ottoman Empire, which involved a political center that
did not want to share its authority, opting instead for a monopoly of
power over political and economic resources (Kayhan 2006). Incor-
porated into the Constitution of 1937, and retained in the consti-
tutional changes of 1961, the statist ideology provided the perfect
ground for the lSI to become more than a simple developmental
forrnula .f The lSI worked more as an ideology than a tool of develop-
ment in this sense.
Despite initial successes with lSI, the eventual consequences of the
policy were grim in Turkey, as they were in the rest of the developing
world . The early phases in the 1960s and the beginning of the 1970s
emphasized the production of consumer goods and brought relative
prosperity. With the deepening phase in the late 1970s, however,
significant debt was accumulated to finance the production of capital
and investment goods (O'Donnell 1998, 58-64; Hirschman 1968).
The resulting inflation, coupled with the deleterious effects of the oil
crisis ofl973 and the Mexican default ofl982, brought uneven and
discontinuous growth, backward agriculture, and massive budgetary

and current account deficits. These and associated economic diffi-
culties were soon accompanied by political predicaments, including
consecutive inefficient coalition governments and consequent social
unrest. Trade union strikes and violent student uprisings were every-
day occurrences toward the end of the 1970s. As the lSI was reaching
its end, extreme ideological polarization plagued the organized labor,
professional associations, civil bureaucracy and the society as a whole
(Ozman 2000) .
The recurrent military interventions that besieged both the Argen-
tine and Turkish processes of democratization were , to one extent or
another, also related to the political, social, and economic difficulties
associated with the lSI. In both cases, the military solemnly declared
itself to have the solution. The Turkish military in the 1980s, like its
Latin American counterpart in the mid-1970s, aimed to change the
economic development plan and rationale of the country from the
old lSI to the new Export-Oriented Industrialization (EOI) model."
Its main and more immediate objective, though, was to put a stop to
rampant crimes and terror reigning over the country. Although the
military was relatively successful in its economic stabilization plans,
new problems arose. Bankers, who gathered large sums of money
thanks to the freeing of interest rates, left the country or went bank -
rupt. Ozal, who was the military government's minister of economy,
resigned (Kongar 1997, 372). The apparent economic failure was one
of the reasons that contributed to General Kenan Evren's decision
to voluntarily transfer power to Ozal's civilian government in 1983.
Unfortunately, the transition was not as smooth for Argentina.
The 1980-1983 economic reforms undertaken by the Turkish
military created a radical change in the economic path that Turkey
was to adopt thereon. The reforms in question meant a clear shift
from a quasi-socialist lSI to a liberal EOI model. They also involved
a reconfiguration of the daily social life. In the pre-1980 period, one
would be afraid to walk in the street with dollar bills in his pockets
since this was against the law. The economic freedom and liberal-
ism endorsed and dictated by the military put an end to the fear of
prosecution. The military achieved that by instituting price deregula-
tion and devaluation. The military also barred the deficit-prone and
inefficient SOEs from borrowing from the Central Bank. It allowed
them to increase the prices of their products and stopped the direct
subsidies they received from the Treasury.
These measures allowed the SOEs to report profits for the first time
since the early 1970s . Some steps, albeit modest, were also taken in
capital account liberalization by eliminating ceilings on bank deposits

(Krueger 1995). These and the five structural adjustment loans (SALs)
in 1980-1984 led to substantial amounts of financial resources flowing
into the country. The World Bank (WE) and the International Mon-
etary Fund (IMF) made it clear that they wanted Turkey to be a model
of success for the rest of the developing world. These ambitions were
identical to those that the same international financial institutions had
in mind for Argentina (Demir 2002,5).
SUMMARY OF TURKISH PRIVATIZATIONS:

PLANNING AND IMPLEMENTATION
While many scholars agree on 1980 as the starting date of Turkish
privatizations, Latif Cakici (1990) suggests that privatization as a
concept in Turkish politics was first seen in a decree of the military
government dating back to December 12, 1972. Although the term
"privatization" never made its way into the text literally, what policy-
makers meant by "opening up to the public" was nothing less than
privatizations. The decree in question read as follows:
SOEs shall be transformed into corporations and linked to holdings

compatible with the principles of free market economics. They will
then sell their shares (1) first to the workers of the SOEs being priva-
tized, (2) then to the local population, (3) followed by the emigrant
workers outside Turkey, and finally to (4) the national firms with good
standing. If shares are left after that, private foreign firms can be con-
sidered as prospective clients, given that they invest in technology.
(19)
Hulki Cevizoglu (1989), like Cakici (1990), claims that the Turkish
privatizations started before the 1980s. He goes even further in main-
taining that privatizations were imminent in the establishment of the
first SOEs themselves. The statist ideology in Turkey never entirely
excluded the private sector as a potential economic actor (Patton
1992). That said, the first actual privatizations of the SOEs had to await
the military regime of the 1980s . Cevizoglu (1989) states that the first
serious privatization undertakings date back to January 24,1980, when
the military government introduced its "Stabilization Program" (77) .
This program outlined the necessary structural changes to be made in
the SOEs so that they could learn to operate according to the principles
of free markets. These changes were formulated under three specific
pieces oflegislation and decrees issued under the civilian government of
Prime Minister Ozal (Onis 1991): (1) law 2983 on Promoting Savings
90 DEMOCRATIC INSTITUTION S
and Accelerating Public Investment, (2) decree 233 on State-Owned

Enterprises (SOEs), and (3) privatization law 3291.
The first piece of legislation, law 2983 of May 1984, divided
up the SOEs (Kamu Iktisadi Kuruluslari, KITs) into two distinct
categories: State Economic Enterprises (Iktisadi Devlet Tesekkulu,
IDTs) and Public Economic Enterprises (Kamu Iktisadi Kurulus-
lari, KIKs). IDTs would be those KITs that were created to operate
according to commercial and market principles . KIKs, on the other
hand, would be those KITs providing "public services" active in ser-
vice sectors and/or possessing a monopoly of production. Law 2983
also transferred the right to decide which SOEs to privatize from the
parliament to the cabinet. This transfer of power on the oversight of
privatizations from the legislative to the executive branch was the first
step toward the gradual centralization of state power that went hand
in hand with privatizations.f
The second part of the 1980 Stabilization Program refers to the
somewhat contradictory decree 233, which introduced the principle
of "contracted personnel." The decree in question precluded that
redundant personnel of the former SOE s be rehired. Those who kept
their jobs after the privatizations were enticed to change their status to
that of "contracted personnel" by offers of monetary compensation.
Policies of contracted personnel created a gap between the incomes
of the contracted and the permanent SOE workers . As such, decree
233 was also the most contested part of this preparatory phase of
privatizations (Cevizoglu 1987).
The third and most important privatization law was law 3291 of
May 1986. It enumerated the agencies and ministries that would
implement and control the privatization processes. Correspondingly,
it divided the authorities in charge of privatizations into two catego-
ries: the cabinet would be responsible for the privatizations of the
SOEs themselves, and the Mass Housing and Public Participation
Administration (Toplu Konut ve Kamu Ortakltgt Kurulu, TKKO),
as a separate agency, would be responsible for the privatization of
the affiliates and partners of the SOEs . Five different methods of
privatization of the SOEs and their affiliates were prescribed by law
3291 : (1) direct sale, entirely or partially; (2) sale of share certificates;
(3) renting; (4) transfer of management rights; and (5) takeover and
liquidation. Each privatization would consist of first transforming the
SOE into a corporation. Once converted into a corporation, the SOE
in question would be removed from the supervision of its affiliated
ministry and placed under the jurisdiction of the Office of the Prime
Minister.
The TKKO was split into two bodies in 1990: the Housing
Development Administration (Toplu Konut Idaresi, TKI) and the
Public Participation Administration (Kamu Ortakltgt Idaresi, KOr).
The first organization was in charge of providing affordable housing
to lower- and middle-income groups. The second supervised the to-
be-privatized SOEs . The KOr would also determine the conditions of
the sale, the amount of shares to be privatized, and all other matters
associated with the divestiture ."
Once the legal and institutional dimensions were developed, the
Turkish government contracted the American financial firm Morgan
Guarantee Trust to draft a Privatization Master Plan (Ozellestirme
Masur Plant, OMP). The plan enumerated the SOEs to be privatized
and ranked them according to the urgency of needed privatization.
The plan also outlined the objectives of privatizations as enhanced
industrial efficiency, economic growth, and the development of capital
markets. Generating revenue from the sale of the SOEs was listed as
a desirable but not a primary objective, although this was soon to be
revised in tandem with the increase in financial needs? (Tecer 1992, 5).
Upon formulation and submission of the plan, the government
swiftly changed course and chose not to implement it, arguing that it
was not applicable to the realities of the Turkish economy. This sud -
den change in approach was later interpreted by scholars of Turkish
politics as the natural consequence of the dead end reached by the
ministries, none of which desired to let go the political and economic
benefits associated with the SOEs operating under their jurisdic-
tions (Yeldan 2005). The Kor changed its name to the Privatization
Administration (Ozellestirme Idaresi, Or) and became autonomous
with full responsibility for taking all decisions concerning revenues
of sales. The objective of the or was to promote privatizations in
the parliament and in various circles of Turkish society. The or also
sought to privatize the profitable SOEs while excluding sensitive areas
like military equipment and minerals.
Law 3291 also included clauses to speed up the emerging
privatization process, such as exemption from taxes and all other
fees for prospective buyers. Other clauses aimed at preventing any
potential social protest, such as the employment guarantee given
to the Retirement Trust affiliated personnel, that is, the permanent
workers of the SOEs to be privatized, so that they would keep
their job until the government's share went below 50 percent. The
loophole in the social dimension of the law, on the other hand,
was that it did not specify options for those not affiliated to the
Retirement Trust, implying that they would either be fired or retired
(Cevizoglu 1989,87). They would have to wait for the 1994 law
4046, which instituted a social safety network in the form of unem-
ployment insurance and assistance with job search and training.
While legal preparations for privatizations took place in the early
1980s, the first actual privatization of a SOE did not take place until
1988, when Teletas, the government-owned telecommunications
company, was privatized." The ANAP government, in line with its
rhetoric and promises of popular capitalism, opted for the method
of public sale of shares for this first privatization attempt. Much to
the government's dismay, however, only a meager public demand
appeared for the shares on the part of national investors. This, in
large part, originated from weak domestic capital markets in Turkey
at the time . The weak demand was also caused by the general decline
in stock markets and the announcement of a major investment cut
by Mail, Telegram, and Telephone (Posta-Telgraj-Telefon, PTT), the
state -owned postal service and a major customer of Teletas prod-
ucts . Teletas' shares lost half their value the year its privatization was
announced.
By offering the shares of Teletas to the public, ANAP's leader,
Ozal, was acting in line with his campaign rhetoric, which empha-
sized popular capitalism as the main goal of privatizations. His stated
objective of privatizations was the incorporation of the middle class
and the workers into decision-making processes. "Workers," he said,
"from now on, will not only be owners of the company where they
work but will also have a chance to participate directly in its manage-
ment. In case a worker loses his job, his/her share will continue to
be a source of revenue for him" (Aysan 2000, 27). The 1983 and
1987 government programs reiterated that the SOEs would be sold
to the Turkish citizens, thereby facilitating the spread of capital to the
masses (Ertuzun 1990,33).
Promises of popular capitalism were soon abandoned following
the Teletas disaster. After that, the privatizing governments turned
to the method of block sales, mainly to foreign purchasers, since the
local entrepreneurs did not seem to be interested in privatizations,
the latter due again to weak domestic capital markets . Selling SOEs to
foreign companies, however, created nationalist resentment, leading
many observers to dub Turkish privatizations "foreignization."
Ertuzun (1990), for instance, likened the sales to foreigners to the
infamous capitulations, that is, economic privileges given out by the
late Ottoman sultans to Europeans and believed to have contributed
to the downfall of the empire. Comparisons were constantly drawn
between privatizations at home and those in industrialized countries,
TURKISH LABOR IN T H E GLOBAL ERA 93
mostly Western Europe, where privatizations have always included a

cap on foreign ownership, typically ranging from 15 to 25 percent.
Public opinion, which initially was in favor of privatizations thus
quickly turned against them after the initial attempts at "foreigniza-
tions" toward the end of the 1980s.
In addition to the "foreignization" dilemma, privatizations were
also stained for the way in which they were carried out. The dominance
of a technocratic style ofpolicymaking and the excessivecentralization
of power in the executive branch started to foment distrust (Yalcmtas
1990). The TKKO consisted of a small group of technocrats chosen
directly by Ozal to whom they, the TKKO technocrats, were directly
accountable. The government personnel responsible for privatiza-
tions were thus independent of other ministries, such as the Treasury,
the State Plann ing Organization (Devlet Planlama Teskilati, SPO ),9
and the Central Bank. This arrangement gave this top privatizing
institution significant autonomy vis-a-vis the parliament as well as the
traditionally statist bureaucracy (Shaker 1995, 32) .
The centralization of power and excessive decree making in the
global era are characteristics that are not unique to Turkey. Many
privatizing countries in Latin America resorted to them in order to
accelerate their processes of privatizations. Menem's Argentina is
notorious for bypassing the parliament and using it as merely a rubber-
stamping body in the making of laws pertaining to privatizations.!?
This tendency, also called decretismo, is visible in excessive decree
making by the administration of President Menem in Argentina.
While Argentine presidents prior to Menem had used their decree
power about 30 times in total, Menem used it more than 300 times in
his first four years in office. The majority of the decrees were issued on
issues related to the implementation of structural adjustment reforms
and privatizations (McGuire 1997,225-26).
The centralization of political power did payoff in Turkey : five
cement factories were sold to the French Societe Generate de Ciment,
and airport ground services were given as a concession to Scandini-
vian Airlines (SAS) in 1989. The privatization of these two profitable
sectors showed that the primary objective of privatizations in Turkey
had by then shifted from increased efficiency and popular capitalism
to revenue generation and debt reduction (Yeldan 2005). The privati-
zation of the cement and airport sectors was followed by that of other
equally profitable sectors of petroleum, telecommunications, paper,
electricity, and iron and steel.
In the sixth five-year plan (1990-1994), the government
reemphasized its commitment to "privatizations as a key instrument
in reforming the economy." The goals of this plan were to increase

economic efficiency, disperse ownership, and improve the quality of
goods and services provided by the SOEs in local and international
markets (Shaker 1995, 34). Despite these reassurances, however, the
structural changes required for privatizations were still not under-
taken in practice. The political instability caused by the inefficient
and unstable coalition governments did not help. Nor did the recur-
rent economic fluctuations characterized by short periods of growth
followed by increasing inflation and rising fiscal deficits.
Labor unions had also become more active in generating resistance
in the form of mobilizations and legal proceedings directed against
privatizations. Their alliance with the left-leaning intellectuals in the
parliament created a strong buffer against privatizations there . As a
result of inauspicious political, economic, and social forces, the priva-
tization of the gas company TUPRAS, the petrochemical company
PETKlM, and the alcohol-producing state monopoly TEKEL did
not generate the expected demand by international firms (Gunes
2004). Only limited success was recorded in the privatization of the
iron and steel complex, Erdemir, the Turkish Airlines (Turk Hava
Yollari, THY), and the telecommunications sector. Instead, these
were put on the privatization list and left without being invested in
until 2004-2005, when the sales took place.
Meanwhile, courts canceled the privatizations of CiTOSAN
and USAS on grounds that they were illegal for not having been
offered through public offerings prior to the block sale, as pre-
scribed by the privatization law 3291 . The legal opposition was
accompanied by mounting social distrust due mainly to the increas-
ing elitism and secrecy attributed to the Ozal government and the
rumors that Ozal himself favored his political allies and friends in
privatization transactions. The inefficiency of the post-Ozal coali-
tion governments made the implementation of privatizations even
more sluggish. In fact, seven years after the start of privatizations,
only 0.5 percent of all SOEs' fixed assets were sold. As of 1992,
the entire divestiture process had generated a meager US $530
million (Shaker 1995, 34) . Between 1986 and 1998, only 10 per-
cent of state-owned assets were divested (Ficici 2006, 2). More
importantly, however, the state still retained control of most of the
companies to be privatized. It also continued to uphold its populist
policy of bailing out several ailing public sector companies.
The 1994 economic crisis characterized by high inflation and
persistent balance of payment problems brought a new stabiliza-
tion program with privatizations occupying an important place in it.
TURKISH LABOR IN T HE GLOBAL ERA 95
The new privatization law 4046 11 demonstrated that Tansu Ciller's

center-right True Path (Dogru Yol Partisi, DYP) government was
finally going to undertake the implementation of the long-planned
privatization projects. This did not materialize, however, due mainly
to her coalition partner from the ultra-right religious Welfare Party
(Refah Partisi, RP), Necmettin Erbakan, who was staunchly against
privatizations and pursued extremely populist economic policies
including high increases in the working classwages and food subsidies
to the poor. Mesut Yilmaz's ANAP government, which followed the
DYP-RP coalition government, was the first to receive a vote of no
confidence by the parliament, due to corruption allegations in priva-
tization transactions.
Since privatizations proceeded very slowly, opposition had ample
time to build up . Workers protested against layoffs, civil servants
disputed the loss of their status in the SOEs, special interest groups
objected to losing their privileged access to local political patrons,
local industrialists complained of losing their access to domestic
markets and subsidies, and finally, politicians complained about the
loss of their constituencies. With sagging political support, civil
governments in the second half of the 1990s resorted once again to
the inflationary politics of increased expenditures apparent in wage
resettlements, subsidies to SOEs and to other special interest groups,
and increasingly generous export incentives. They thus followed
the same recipe of neopopulist policies'< that the second Menem
administration (1995-1999) applied in Argentina and did so for the
very same reason: sagging political support. This led many scholars to
conclude that democratization and economic liberalization do not go
hand in hand due mainly to the virus of populism endemic to fragile
democracies (Eder 2003) .
INSTITUTIONAL- LEVEL ANALYSIS

OF PRIVATIZATIONS: LABOR UNIONS IN TURKEY
While the history of privatizations merits more attention, the direct
and indirect effects of privatizations on labor is the focus of this
study. The impact of privatizations on labor unions and workers
in Turkey was substantial. Cevizoglu (1989) outlines two ways in
which the 750,000 public sector workers in the mid-1980s were
affected by privatizations: (1) by being the first group entitled to
buy share certificates in the SOEs where they were employed and
(2) by facing the risk of losing their jobs . In a previous study by the
same author (1987), the labor unions' knowledge of, and reactions
96 DEMOCRATIC INSTITU TIONS
to, privatizations were studied through questionnaires and in-depth

interviews with union leaders . In this study, five questions were
directed to the main Turkish labor union confederation, TURK-IS,
and its affiliated unions. The questions were as follows:
~ What do you understand of privatizations (definition and

interpretations )?
~ How do you evaluate the current situation of the SOEs?
~ What do you think the downsides of privatizations are?
~ Do you have any alternative suggestions to privatizations?
~ Ultimately, are you for or against privatizations?
The results of the 1987 survey demonstrated that the union

leaders' understanding of privatizations was either incomplete or
ambiguous. Many did not know what privatizations were . Others
were biased because they relied exclusively on socialist-leaning or
ideological publications. As such, most were tempted to view priva-
tizations as a political polemic rather than an economic tool. Finally,
by the end of the 1980s, neither TURK-IS nor its affiliate unions had
yet published any document related to the privatizations.
I repeated Cevizoglu's 1987 research in Western Turkey in 2005.
I conducted extensive interviews with 14 Turkish union leaders
at various levels of union hierarchy. I asked them the same five
questions, plus five others.'?
~ How do you think privatizations have affected the structure of

the union movement, such as the divisions and groupings within
federations and unions?
~ How do you think privatizations have affected unions' relation-
ship with the state?
~ Have privatizations changed the way unions interact with business
and civil society organizations?
~ Have privatizations changed the functioning of unions' internal
democracy in any way? If yes, how?
~ What do you think the relationship might be between privatiza-
tions and democratization?
This study corroborated the finding that the initial period of

privatizations did not incite any significant reaction on the part of the
three main confederations and their affiliated unions and sections .
The two most commonly cited reason for the lack of a strong labor
response to privatizations between the mid-1980s and the mid-1990s
were (1) the cultural personality trait demonstrating a lack of concern

for what does not affect one directly and (2) the government's lack of
credibility in implementing the privatizations. The secretary-general
ofTURK-IS's first regional federation, Faruk Buyukkucak, said,
Labor union leaders saw privatizations as a possible meteor that would

not reach the planet Earth for thousands of years.
(Istanbul , August 2005)
Mehmet Kihc, the leader of the Bursa section of the United Union
of Metallurgy Sector Workers (Birlesik Metal), affiliated with DISK,
narrated the following anecdote to describe the initial reactions of the
Turkish labor unions to privatizations:
Three boars were living happily in their forest until one day when a
friendly-looking lion appeared. The lion asked one the boars in private
why he was alwayssticking up with his two other friends. He suggested
that he, the lion, eats one of the boars so that they can rule the whole
forest together. The first boar complied and the lion ate one of the two
other boars. The next day, the lion asked the second boar the same
question, and the second boar was eaten. The lion then said to the only
remaining boar: for you, I don't even have an excuse.
(Bursa, August 2005)
Unions surveyed in the mid-1980s by Cevizoglu (1987) agreed

that privatizations went against one of the basic founding principles of
the Turkish Republic, namely the principle of the "social state." The
main reason the union leaders gave to support this argument at that
time was that privatizations were destroying lucrative and competi-
tive SOEs while hurting employment, thereby resulting in unequal
distribution of income and resources. The arguments of "social state"
pointed to the prevalence of political ideologies as a driving force in
union leaders' perceptions of privatizations. As shown in table 4.1.,
Table 4.1 Classification of the Turkish labor union system in the 1990s: Political
ideology as the main divide and neoliberalism becoming controversial
Division DISK TURK-IS HAK-IS MISK (1984-88)

Political LEFT-Social CENTER"""7"" RlGHT- RlGHT-
Ideology Democrat Conservative Political Islam Nationalist
Position toward
neoliberalism Against Mixed In favor Against
Strategy Confrontation Compromise Business Not relevant
the main Turkish labor confederations could be differentiated from

one another by their political leanings until about the mid-1990s.
By 2005, all of the interviewed union leaders acknowledged that in
the pre-privatizations period, the SOEs were decaying economically
and were corrupt politically. Only a minority continued to cling to the
argument of social state . The realization that privatizations were real
and that all governments, regardless of political ideology or leanings,
took a stab at them gradually convinced labor unions that globaliza-
tion had hit Turkey and that they had to adjust. This showed the
declining importance of political ideology among the ranks of union
leadership and the growing impact of privatizations on the Turkish
labor union system. Taskin Gundag, the secretary of education and
mobilization for the Union of Food Sector Workers (Gida-Is) in
Istanbul, said
Privatizations go against the very foundation of the Turkish Republic

because they destroy Populism (Halkctltk ) and Statism (Devletcilik) ,
which are two of the six pillars of Kemalist ideology. For some
[showing his pack of a cheap Turkish-brand cigarettes], it is a matter
of national pride and emotional attachment to smoke Samsun, and not
Marlboro, even though, I must admit, the latter tastes better.
(Istanbul, August 2005)
The survey questionnaires and in-depth interviews I conducted

with the Turkish union leaders in 2005 also showed that, in contrast to
1987, they all now had a clear understanding of privatizations, regard-
less of their ideological and political leanings. Moreover, by 2005,
union leaders had all devised numerous innovative strategies to act
with or against privatizations. There was practically no union that had
not published a report, an informative brochure, or even entire books
defining, analyzing, and explaining privatizations and strategies about
how to prevent and to survive them. Finally, interviews and the focus
groups conducted with groups of workers, living in different cities and
active in different sectors that have undergone privatizations, showed
that union leaders and workers tend to direct their frustrations against
privatizations at international financial institutions such as the IMF and
the WB, and at the United States much more so than at the privatizing
governments or the national entrepreneurs. As Ayfer Yilmaz, the senior
researcher at the Union of Petroleum Workers (Petrol-Is), said
This is ideological on the part of tho se international powers dictating

the privatizations. So, we should respond in an ideological way if we
want to prevail. That is why we came up with the idea ofharne ssing the
TURKISH LABOR IN THE GLOBAL ER A 99
anti-war groups by showing how privatizations in the gas sector were

in fact helping the war in Iraq. This strategy paid off.
(Ankara, August 2005 )
The creative anti-privatization media campaign that the Petrol-

Is devised against privatizations included pamphlets, brochures,
booklets, and advertisements in the major Turkish newspapers. One
of these advertisements displayed a gas pump held as a revolver by
a hand, against the neck of a lady wearing a golden necklace, the
latter representing the economic well-being and honor of a family in
the Turkish culture. The slogan read , "Tupras [the state -owned gas
company] is our future. It cannot be sold" (Petrol-Is 2005) .
These and other strategies adopted by Turkish labor unions
indicate that they have responded to privatization s in unusual and
inno vative ways. Until the mid-1980s, the Turkish union movement
was primarily shaped by (1) state-dependent un ionism and its strategy
of PAP by TURK-IS on the political plane, (2) lSI on the economic
plane, and (3) a lack of independent and competitive political experi-
ence on the social plane . These political, economic, and social feature s
affected all unions, but more particularly those active in the public
sector, since they were living in symbiosis with the state . In other
words, unions active in the SOEs were also those managing their
company, either literally or because they had considerable power over
the civil servants who acted as th eir manag ers.
Privatizations either lessened or changed the nature of the symbi-
otic ties between "state" unions and the "big cumbersome state" by
transforming the former into " private secto r" unions and the latter
into a "smaller effective state." Privatizations also offered a fertile
ground for undemocratic and apathetic labor union s to gradually
shift their political identity to adopt a different strategy that actively
supported democratization. While such developments do not mean
that corruption has ended, it does mean that the nature of unionism
and labor-government relations has changed. According to an anec-
dote narrated by a former TURK-IS representative, it sufficed for a
labor confederation leader to phone the prime minister in order for
bureaucrats managing the SOE to be transferred, or better put, exiled
to different parts of Anatolia in the 1970s.I4 Now, it is state , and not
the unions, that has the final say about the rules of the game.
The replacement of PAP by more autonomous union strategies, the
substitution of the lSI with the EOI model of economic development,
and a more active union leadership are some ofthe visiblechanges intro-
duced or stimulated by privatizations in the Turkish union movement.
100 D EMO CR ATI C I N STI TUTIO NS
Table 4.2 Classificatio n of the Turkish labor union system in the 2000s:
Privatization: as the main divid e
Na me T URK -IS DI SK HAlOS
Position Implicit Explicit Enth usiastic

Prop onent Opponent Part icipant
Main Strat egy Survive in DefY Thrive with
privatization s privatization s privatization s
Cultu re Pragmatic Active Active
compromise confrontation collaboration
Main Tool Access to Access to Access to financial
(Privatiz ations used as) information democracy drive freedom
As shown in table 4.2, neoliberalism and distinct attitudes toward priva-

tizations were used more and more as position shapers in the Turkish
labor union system in the 2000s.
TURK-IS-Implicit Proponent of Privatizations

Th e prelude to the transformation of labor as a result of privatizations
started with the realization by TURK-IS, the largest confederation
organized in the public sector, that the Politics of Above Parties
(PAP) was no longer a suitable political strategy. Written into the
bylaws of TURK-IS since 1964, the principle in question entailed
maintaining friendly relations with the governing party or parties,
regardle ss of their ideology, their stand on labor issues, or dem ocratic
credentials . PAP was not about staying above or outside politics, as
it seemed to imply. Quite the opposite, it was about getting more
entrenched in it. It was, to say the least, an implicit pact of collabora -
tion between TURK- IS and th e government of the day, wrapped in a
package of "patriotic unionism" (O zugurlu 2002,181) .
In practice , PAP helped preserve a stable and predictable quid
pro quo relationship between the unions and the state. Accordingly,
labor would acquiesce to the policies of a given government, which,
in turn, would allow the corresponding union leaders to enjoy
political and economic benefits . With the elimination of PAP and
the gradual decline of state-dependent unionism, unions started to
become more independent. For the first time in the Turkish union
history, unions voiced their explicit demands regarding union free-
doms promised by the DYP and the SHP coalition government in
1991 . Labor unions were important in forming an important check
on the government by making sure that the coalition government

signed the ILO Conventions 59, 87, 135, 142, 144, 151, and 158
in 1992 (Gulmez 1988).15
Privatizations led to the abolition of PAP by drying up the
subsidy flows to the SOEs and the workers employed in them . Once
the scheme of economic benefits in exchange for electoral support
was abandoned, it became harder for the working class to get by.
The disgruntled workers of the SOEs took their cause to the streets
and staged the famous 1989 Spring Strikes. The 1989 Strikes were
the first workers' mass movement in the history of Turkish labor,
which was organized without the initial intervention of union lead-
ership . They also involved protest movements that were previously
unheard of in terms of scope and strategies. Refusing to eat, leaving
work to go see the firm's doctor, organizing protest marches with
bare feet, and sending mass telegrams to politicians were some of
these innovative forms of social dissent. Agitation within the rank
and file ultimately led TURK-IS officials to take an anti-government
stand in the 1989 local elections. This was a first in the history of
TURK-IS since its founding in 1952, leading ultimately to the ero-
sion of its PAP rationale .
The eradication of PAP signified the end of conspicuous and
unconditional political support for whatever political party or coali-
tion of parties was in the government. TURK-IS was astute enough
to substitute PAP with another political strategy : the "implicit sup-
port of privatizations." TURK-IS, in other words, by adopting an
attitude less transparent vis-a-vis privatizations, became the implicit
client of privatizations either by complying with them implicitly, that
is, by inaction, or by supporting them. Doing that, TURK-IS con -
tinued to publicly criticize privatizations and altered its rhetoric from
case to case.
Although TURK-IS made less explicit use of its PAP strategy to
contest privatizations in the beginning, it continued to experiment
with patron-client type dealings with the governing parties. In fact,
TURK- IS resorted to anti-government campaigns and mobilization
only if and when PAP failed to produce the desired results . The
negotiations that TURK-IS led with the government on the rehir-
ing of the downsized personnel as a result of the massive privatiza-
tions of the 1990s, for instance, led to the formulation of the "4-C
clause" of the 1994 privatizations law no. 4046 . The 4-C clause
gave the downsized workers the choice of transferring to public
administration as temporary, nonunionized personnel. In this way,
1,800 of the 7,000 workers unemployed as a result of privatizations
were placed in various government agencies as contracted public

servants.l? TURK-IS's intensive negotiations with the government
showed its resolve to protect as many workers as possible and in any
way possible in the privatization processes deemed inexorable by
2000. These negotiations, among others, also showed that TURK-IS
had become more deliberative and autonomous and that partner-
ship with privatizing governments was valued to minimize damage
and to maximize interests.
With privatizations, TURK-IS has also solidified its links with the
private sector. The Turkish Employers Association (Turkiye Isveren
Sendikalari Konfederasyonu; TISK) designated TURK-IS as its best
interlocutor with the rank and file at the time of this study in 2005 .
Employers operated in harmony with TURK-IS representatives since
"they alone knew how to speak the language of the workers from all
corners of the country. The employers, factory owners and indus-
trialists did not necessarily know how to talk to the rank and file,"
said Tugrul Kutadgubilig, the secretary-general of TISK (2005 ).17
This confession attested to TURK-IS' new role in the global era as
an active hub of political bargaining and a facilitator between the
government and the business sector in the 2000s.
Privatizations also affected the relationship between the TURK- IS
leadership and the rank and file. It is interesting to note, for instance,
that the 4-C clause that the TURK-IS leadership was proud of, and
cited as a positive accomplishment in many instances, was consistently
referred to as the "infamous 4-C" among its rank and file, regardless
of whether the interviewed workers were affected by privatizations
or not. The fact that unionization was debilitated and workers with
many years of valuable experience in different industrial sectors were
obliged to work as cleaning staff or office boys for only ten paid
months in a year in the public sector were some of the reasons cited
by workers for vilifying the 4-C. A visible and significant distancing
thus occurred between the rank and file and the union leadership due
to the latter's hinging role in the privatizations. As Kadir, a worker
at the Turkish Telecom, which was sold a day before the interview
to a private company from Saudi Arabia, put it "The privatizations
have proved the chameleonic nature of the union leaders" (Istanbul,
August 2006) .
As a result of privatizations, TURK-IS has found itself obliged to
resort to new and modern union strategies of researching profit-
ability, efficiency, and economic participation in the firms to be priva-
tized as well as the globalization trends and the business practices of
prospective buyers. TURK-IS has produced multiple reports and
communiques, has lobbied the government, mobilized its rank and

file, and forged links with civil society organizations such as the
Public Administration Development Center-Foundation (Kamu
Isletmeciligini Gelistirme Merkezi, KIGEM) without entirely letting
go of its old and trusted practices of partisanship with the governing
party or parties, patron-client nexuses with the main industrial asso-
ciations and employers, and its populist links with the rank and file.!"
This innovative mixture and the fragile balance of old and new,
traditional and modern, populist and liberal are not unique to
TURK- IS or Turkey. Many labor confederations in other parts of
the developing world have also ingeniously combined their old
tactics with new ones once convinced of the inevitability of priva-
tizations.'?
DISK-The Explicit Opponent of Privatizations

While TURK-IS cautiously collaborated with privatizations, DISK
has taken a clearly and ideologically anti-privatizations stand. This
was ironic in a sense since DISK is a labor confederation organized
solely in the private sector, hence not as much affected by privati-
zations . This irony can be explained by the fact that privatizations
were starting to be implemented when DISK reemerged in 1991
after a political ban on its activities dating back to the 1980 military
government. Privatizations, therefore, provided DISK with a timely
tool to forge itself a new identity. DISK equated its struggle against
privatizations with one for self-reinvigoration. It declared its new
mission to be "the earning back of social trust, the advancement of
democratization, and the resolution of political problems."(TISK
1995, 214). To attain these goals, it was indispensable to contest
privatizations, which were causing poverty and social distress. Suley-
man Celebi, the secretary -general of DISK, explained
Privatizations hurt social development by pauperizing and marginalizing

large segments of society. They also promote deunionization. So, it is
inconceivable that they contribute in any way to democratization.
Countries that are not industrialized cannot be democracies . Privati-
zations do not contribute to industrialization. Industrial ization, and
hence democratization, are possible only through institutionalization
and planning under the auspices of the state . Turkey is at such a point
that I would not be surprised if democratization itself is privatized one
day. Ifwe like privatization, why not hire a private company to democ-
ratize Turkey and the Turkish state?
(Istanbul, August 2005)
DISK's project of democratization has consisted of tapping into

the new societal consensus on Turkey's membership in the European
Union as well as the industrial requirements of being an advanced
democracy, while making sure its "members were educated, informed
and content with their lives" (Celebi 2005) . To achieve these aims,
DISK hired young and well-educated personnel as researchers and
advisers and prepared research projects and analyses of political, eco-
nomic, and social projects involving the whole community and the
Turkish society (Genis 2002, 302). In fact, DISK stands out among
the Turkish confederations as one that most overtly works on and for
democratization.
Participation in privatizations was refused by DISK on the ideo-
logical grounds that such endeavors would negate the very identity of
a workers' association . Unions participating in privatizations, in turn,
were seen as examples of "yellow unionism."20 Despite ideological
repudiation, DISK has concentrated on the pragmatic consequences
of privatizations. Researching and predicting that privatizations will
most certainly extend to the education system soon, DISK has under-
taken an innovative research project on, and an early organization of
workers in, the sector of education.i!
The case of DISK shows that privatizations, by rekindling an intel-
lectual and social struggle, have worked as an invisible hand ofdemoc-
ratization. Privatizations have promoted democratization not directly
or purposefully but because they have sparked reaction, thinking,
organization, and action. Privatizations, and the very struggle they
have ignited, have contributed to the remaking of DISK as a center
of research and activism on democratization. In its new identity and
role, DISK has chosen to pursue a political project of democratization
in which socialism no longer has a part.
HAK-IS-The Enthusiastic Participant in Privatizations

As opposed to the center-right TURK-IS and the left-wing DISK,
HAK-IS, which subscribes to the Islamic ideology, has been an active
participant in privatizations.P Examples abound. In the privatiza-
tion of Kardemir Steelworks in 1995, the HAK-IS-affiliated Union
of Steel Workers (Ozcclik-Is) collaborated with the local population
and a group of industrialists to purchase this industrial complex .P
The Union of Food Sector Workers (Ozgida-Is), another affiliate of
HAK-IS, also participated in the privatization of the state conglom-
erate processing fish, milk, and meat products (Et vc Baltl: Kurumu,
EBK; Sut Endustrisi Kurumu, SEK) in 1994, even though the
government later abandoned the deal in the face of rampant criticism

in the media.I" The Ozcelik-Is became a viable participant in the
privatization of the Seydisehir aluminium plants. The AKP govern-
ment, however, its ideological and partisan links with the HAK- IS
notwithstanding, refused the privatization plan drafted by the labor
confederation. According to Osman Yildiz, senior adviser to the sec-
retary-general ofHAK-IS, by refusing to even review the proposition,
"the AKP government committed hara-kiri." Yildiz (2005) said
Were they to accept our participation in the privatization of the plant,

many more privatizations could be accomplished and much more
smoothly. But since the government refused, HAK-IS is not in good
terms with the AKP government, at least for now.
(Ankara, August 2005)
HAK-IS's rationale for acquiescing to and participating in privati-

zations was that less government involvement in the economy would
be beneficial for both economic and social development in the long
run. Its involvement in the privatizations changed HAK-IS in two dis-
tinct ways. One was its activity level. Although HAK- IS had had only
limited activities until the mid -1980s, it became much more active in
the 1990s. It gave up its passive role as a mere critic of TURK-IS with
no clear plan of its own to adopt a more active role as an enthusiastic
participant in the privatizations. HAK-IS's new plan consisted first
of convocation, deliberation, and discussion ; then the formation of
alliances with societal actors, including the producers, farmers, and
civil society representatives; and last but not least, engagement in
extensive research. Yildiz (2005) calls HAK- IS' new style of unionism
as lobicilik or lobbying.
The second way in which HAK-IS was affected by privatiza-
tions, albeit indirectly, was ideational. Arguably, the opportunity
to participate in the privatizations in the form of acquiring and
managing shares for union members ultimately contributed to
HAK-IS' resolving its identity dilemma and a redefinition of its
values and future objectives. HAK- IS adopted a more professional
look and a more secular outlook with privatizations. The change of
its emblem from the trio of "a mosque, a crescent and a factory" to
that of an "oracle, an olive branch and a crescent" pointed to more
than a mere symbolic renewal. In the mid-1990s, HAK-IS redefined
Islamic unionism as pro-capitalist and anti-state. Its panacea from
then on became the formation of a vigorous civil society as an anti-
dote to a cumbersome and overarching state. This made HAK-IS
the first Islamic organization to move from political Islamism to the

rhetoric of Western-style democracy and secularism (Bugra 2002) .
The confederation's learning experience with privatizations provided
it with the perfect terrain gradually to construct its renewed identity
as an active "business union" in the 2000s.
In its new role and identity in the global era, HAK- IS has made
use of the civic strategies of reaching out to communities and business
associations with multifarious social and economic projects. It has
created cooperatives to help its affiliated members become sharehold-
ers in the privatized SOEs It has established social bureaus in major
cities for educating and guiding workers and their families dislocated
as a result of privatizations.F' It has set up "community houses" that
welcome their displaced members and their families. These apart-
ments offer temporary housing, counseling on economic, social, and
psychological issues, and temporary financial help.
HAK-IS representatives have also visited European capitals and
contacted labor union leaders there to learn about their experiences
and strategies used in dealing with privatizations. As a result, HAK-IS
has chosen to become part of privatizations without losing its identity
as a workers' organization. Toward these ends, HAK-IS has under-
taken extensive research on the po ssible ways of integrating into the
global world. The research and policy orientation of HAK- IS has not
stayed confined to the political economy of privatizations. The social
dimension has also received its share of attention. The confederation's
report on the child labor industry in Turkey, for instance, is unique
in that it outlines the problem in detail and suggests strategies to
alleviate it (HAK-IS 2000) . Finally, HAK-IS, much like its Argentine
counterpart, Federation of Light and Power (Luz y Fuerza), is cur-
rently in the process of discussing the project of establishing a school
of labor unionism where all workers, regardless of their affiliation or
ideology, would be welcome.l"
PRIVATIZATIONS AND DEMOCRATIZATION AT THE

LEVEL OF INSTITUTIONS: PATHS AND CAVEATS
A general typology of the main Turkish labor confederations
according to their distinct positions vis-a-vis privatizations should not
be taken to mean that the strategies of TURK-IS, HAK-IS, and DISK
have been uniform and monolithic in their reactions. On the contrary,
privatizations, by penetrating and perforating confederations, have
placed unions along pro- and anti-privatizations lines also. As a result,
a cluster of unions within TURK-IS has espoused clear and consistent

anti -privatization policies a la DISK. One of these anti-privatization
unions affiliated with the TURK-IS, the Petrol-Is, for instance, has
instituted an active department of research that has produced infor-
mative and educational publications, anti -privatization brochures,
posters, newspapers ads, and campaigns on radio and television sta-
tions . In its struggle against privatizations, Petrol-Is has reached out
to many left-wing politicians, social democratic academics, journalists,
and other intellectuals and made full use of multimedia technology
to produce informative material on privatizations while simultane-
ously acknowledging the indispensable need to adapt to the changing
circurnstances.F
While each of the three labor confederations has taken a sui
generis approach to privatizations, they all have converged in
their new and explicit support for political democratization in
Turkey. Since the beginning of the privatizations in the mid-1980s,
TURK-IS has abandoned its pro-state PAP strategy to favor a more
mixed and autonomous approach of pol itical clientelism and profes-
sional negotiation. HAK-IS has used privatizations as an important
tool to change its identity from passive and Islamic to active and
pro-democratization unionism. Finally, DISK has channeled its anti-
privatization ideology into a political project of democratization. As
such, they all have reached out to the newly emerging Turkish civil
society to organize panels, establish research institutions, giving
the message that labor unions are now autonomous and legitimate
actors of governance . They have tried to compensate for the loss in
their membership via the image of a "professional negotiator" in the
case of TURK- IS, an "intellectual activist" in the case of DISK, and
a "compassionate entrepreneur" in the case of HAK- IS.
The three confederations have also cooperated among each other
as a direct result of privatizations. In fact, the pinnacle of the new
union-promoted democracy movement in Turkey came at a time
when privatizations were being accelerated and globalization was
fiercely debated. The Platform of Democracy (Demokrasi Platformu),
instituted in 1993 by the collaborative efforts of the three confedera-
tions' was a social enterprise that would have been unheard of in the
pre-1980 period. Within the framework of this initiative, university
professors , profe ssional associations, and other white-collar profes -
sionals worked hand in hand with union representatives to organize
conferences, produce research articles, and promote public aware-
ness about privatizations. Although this civil society initiative by
108 D EMO CR ATIC I NST ITUTIONS
the Turkish union movement subsided by 1995, regional working

committees remained, as did the desire to transform Turkish labor
unions into more active and transparent entities.i''
The Public Administration Development Center-Foundation
(Kamu Isletmeciligi Gelistirme Merkezi, KIGEM), a nonprofit, non-
governmental research organization dedicated to labor issues and
privatizations, is another organization founded by the collaborative
efforts oflabor and civil society organizations. This is an organization
directly related to privatizations since its raison dJetre is to scientifi-
cally establish that public enterprises can be run efficiently with ade-
quate reforms and that privatizations are not indispensable. KIGEM,
like DISK, constitutes a good example of the intriguing way in which
privatizations have worked as an invisible hand of democratization,
producing unintended consequences of increased civil society forma-
tion, activism, and research on and for democratization. This is the
case because it was not privatizations per se, but the aversion toward
them and their possible negative consequences, which led to the
establishment of this vibrant civil society initiative .
Internet sites, where leaders from labor and civil society sectors
interact and publish their opinion pieces and articles, also emerged
and spread rapidly in the late 1990s. The Labor Update (Sendika
Gundemi) site, for instance, gives labor news from all around the
world and interconnects the Turkish rank and file through social
activities and research databases . The site also provides links to
various national and international labor unions and organizations,
newspapers and periodicals, youth organizations, and democratic civil
society organizations. Privatizations constitute a category separate
from globalization and politics on the homepage of the site.
The Union Net (Sendikanet) is another portal that aims to con -
nect the trade unions of Turkey with those of the rest of the world.
The flashing slogan, "It is our future that is sold with privatizations;
we are not going to sell our future," shows the direct link between
privatizations and the foundation of this civil society initiative in
2005 . The new project that this organization is working on is the
connection between democratization and a vibrant labor movement.
Last but not least, the Center for the Investigation of Class in Turkey
(Turkiye SinifArastirmalari Merkezi, TUSAM) is a civil society initia-
tive founded in 2001 as part of the Center of Social Studies (Sosyal
Arastirmalar VakfiJ SAV) whose aim is to study the Turkish society
from a class perspective . In difference from the last two initiatives,
this one has a more blatantly leftist tone and theoretical coverage .
TUSAM also provides a rich source of articles and research initiatives
on privatizations. All of these social initiatives have had privatizations

at the root of their formation, as they explicitly state in their institu-
tional history and objectives.
To recapitulate, the interviews with Turkish union leaders and an
overview of the recent developments in the Turkish labor movement
from a historical perspective show that the effects of privatizations on
the latter have been manifold.
Structural Fragmentation with Strategic Cooperation: Privatizations

have divided and reinforced the existing political divisions at the con-
federation level and led to a differentiation of union strategies in the
political arena. The center-right TURK-IS has adopted a culture of
compromise whereby it has acted as an implicit proponent of privati-
zations, whereas the left-leaning DISK has subscribed to a culture of
confrontation whereby it has functioned as an explicit opponent of
privatizations; finally, HAK-IS has espoused a culture of business union-
ism whereby it has become an enthusiastic participant in privatizations.
Divisions with respect to the stand of labor on privatizations
have also taken place within the confederations. Within TURK- IS,
for instance, the Petrol-Is, the Gida-Is, the Union of Port Workers
(Liman-Is), and the Union of Leather Workers (Deri-Is) have adopted
an anti-privatizations stand in a similar way to DISK. The relatively
well-off Union of Metallurgy Workers (Turk-Metal) and the Textile,
Knitting and Clothing Industry Workers' Union (Turkiye Tekstil
Orme ve Giyim Sanayi Iscileri Sendikan, TEKSIF) have been pro-
privatizations ala HAK-IS .
New Union Leadership and Governance Style: Although privatiza-
tions have not led to any visible changes in the internal organization
and workings of labor unions, they have contributed to the emer-
gence of a new and cautiously more autonomous leadership style at
the local level. The active local leadership that has emerged in parallel
to the privatizations has coexisted with the old and traditional ways
of conducting labor politics. This has meant a decrease in and not the
disappearance of the patronage-based partisan links between labor
union confederations, as exemplified in the mitigation of the PAP
principle . If one has to define the dominant leadership style in each
one of the three labor confederations, it is possible to say that the
TURK- IS leadership has chosen to "survive" in privatizations, HAK-IS
has elected to "thrive" in privatizations, while the leaders in DISK
have opted to "defy" privatizations.
Demands for Democratization: Turkish unions have for the first
time and explicitly supported political democratization in Turkey in
the period starting with privatizations. Doing that, they have each
used their respective and peculiar perceptions of privatizations as one
of the principal stimulating factors for their new project of democ-
ratization: DISK's negative perception of privatizations as the main
culprit of all woes, such as growing poverty and marginalization;
TURK-IS' ambiguous perception of privatizations as both the force
of deindustrialization and the tool for better access to information;
and finally, HAK-IS' positive perception of privatizations as a means
to develop and strengthen civil society are the visible paths through
which privatizations have advanced the democratization of labor
unions in Turkey.
INDIVIDUAL- LEVEL ANALYSIS

OF PRIVATIZATIONS: TURKISH WORKERS
Labor unions are important institutions in both democratization
and privatizations. Labor unions do not, however, provide us with a
comprehensive picture oflabor movements. The latter necessitate the
scrutiny of those workers who make up the labor unions and whose
lives have been directly and significantly affected by privatizations. It
is true that in most countries, developing and developed alike, union
leaders rather than the rank and file, determine the path a union
takes in politics. But even then, a focus on democratization neces-
sitates bringing in the workers and their perceptions for four reasons :
(1) organized groups of workers , with or without their unions' lead,
are crucial collective actors in democratization processes (Collier
and Collier 1991); (2) democratization is not only about strategic
games played by the elite only, it is also about social movements and
grassroot organizations; (3) iflabor unions constitute a fertile ground
for the study of the effects of privatizations from a meso-institutional
perspective, perceptions of workers do the same for the study of the
impact of privatizations from a micro-individual perspective; and
finally, (4) individual and group perceptions are indispensable parts
of the social and political life and are thus worth examining for a
thorough understanding of privatizations.
There are not many studies investigating the effects ofprivatizations
on workers in the case ofTurkey. Theo Nichols et al. (2002) carry out
a historical analysis of Turkish unions from a sociological perspective
and exclude privatizations outright. Cern Surhan's (1999 and 2002)
economic analyses examine the effects of privatization on job security,
wages, and unionization from an economic perspective, without
TURKISH LABOR IN THE GLOBAL ERA III
discussing democratization. Studies that focus on the impact of priva-

tizations on workers examine the question of whether workers agree
with privatizations or not, rather than attempting to gauge their politi-
cal activism in response to the privatizations (Nichols, Sugur, Demir,
and Kasapoglu, 1998). The only study that directly includes workers
is the work by Aysit Tanscl (1998), who examines workers displaced
as result of privatizations in the cement and petrochemical sectors .
Tansel's focus, however, stays confined to socioeconomic hardships
and professional endeavors ofworkers in the post-privatization period.
It does not extend to the political dimension of privatizations.
Have workers affected by privatizations in different ways and
degrees changed their political attitudes toward democratization?
Have they lost trust in democracy in the wake of privatizations? Have
they become more or less active politically? Have they joined social
movements or gotten involved more in local community activities to
voice indignation or to protest? How has the ir voting pattern changed
toward political parties with a specific positioning on the issue of
privatizations? Have they tried to chastise the pro-privatizations
government by granting their political support toward another party?
Do these workers themselves perceive a link between the potential
changes in their political attitude and the privatizations? These and
related questions are important for a thorough understanding of the
sociopolitical consequences of privatizations.
Research Methodology and Findings

This research on the impact of privatization on workers uses three
different methods. One is the short survey questionnaire conducted
in a nonrandomly selected sample of 28 male Turkish workers in
several cities in Western Turkey, who are currently or were previously
employed in sectors that have undergone privatizations.i? The other
method is the focus groups involving 20 out of the 28 workers sur-
veyed. The third method used in this study is the in-depth interviews
run with eight individual workers . All three methods complement one
another by allowing the analysis to focus on both context and sub-
stance, analyzing the individual experiences of workers to tease out
expressions of causality between privatizations and democratization.
The focus groups, summarized in table 4 .3, constitute the most
important methodology from which come the conclusions ofthis part
of the study. Accordingly, two to three short questions were directed
to workers in five focus groups, two of which were conducted
......
......
N
Table 4 .3 Focus Groups in Turkey, 2005
Dominant Co nfederation Priv. Priv. 0

trl
FG Place/ Sector Participants Ideology affiliation Partisanship Imp act Percepti on PPPP s::
0
BURSA 5 Left nisx Yes None Same o
::tI
automotive :>-
>-l
II iZMIT 4 Right HAK-i$ Yes - + Same o
-
paper if allowed .....
Z
III iSTANBUL 3 Center-right Previously TO RK-i$ No - Up (Jl
>-l
ports temp . >-l
-
IV ANKARA 3 Center-left Previously TORK-i$ No Up
-c::
>-l
Petroleum/cement (Social Democrat ) temp . 0
-
V iSTANBUL 5 Left TORK-i$ Yes Non e Same Z
(Jl
toba cco
---
Note: PPPP refers to Post-Privatization Po litical Participation .
in Istanbul, one in Bursa, one in Izmit, and one in Ankara. The

questions were as follows:
~ What do you think of privatizations?

~ How have privatizations affected your life in social, political, and
economic terms?
~ Have privatizations made you more active politically-leading you
to participate more than just through voting, including involve-
ment in street protest movements, contacting your local and
national representatives, organizing or joining a social movement,
a local grassroots organization, et cetera?30
Focus groups conducted with Turkish workers showed that they

have very strong opinions about, and generally a hostile position
toward, privatizations. This was the case regardless of whether they
were directly affected or about to be affected by privatizations, or
not affected at all. Workers from the German-owned Gramer fac-
tory, which produces car seats, in Bursa, for example, were all from
the private sector, thus not affected by privatizations. They, however,
portrayed a much more anti-privatizations attitude than some of the
workers who were directly and negatively affected by privatizations,
like those former workers of the now privatized paper and cellulose
producing SOE (Turkiye Seluloz ve Kagit Fabrikasi, SEKA) in Izmit.
These workers lost their jobs along with their accustomed way of
life with privatizations since they and their families had also worked in
the same plant for generations. Yet, after less than a year following the
divestiture, they were now converts of privatizations, dubbing them
"a sour but necessary medicine for the Turkish economy."
What explains this incongruity? Why those workers downsized as
result of privatizations are for privatizations, while those who are not
affected by them are against? This incongruity is easily explained when
the political ideologies of the constituents of the two focus groups are
considered. The private Bursa-Gramer factory workers were affiliated
with the left-wing and strongly anti-privatizations labor confederation
DISK. The former SOE workers of Izmit-SEKA, on the other hand,
while legally barred from becoming union members due to their
status as "temporary public employees" in the Izmit municipality,
were replicas of what the right-wing, pro- Islamic labor confederation
HAK-IS stands for. As a matter of fact, all of the participants of this
focus group, except for one worker, were members of the Islamic
AKP. In both cases, workers were active both in their unions, and
in some cases, in the political parties of which they were members,
except for one worker in the Izmit focus group who was neither a
supporter of AKP nor a convert of privatization. These two groups of
workers were young, their ages ranging between 20 and 35 years.
When asked about the links between privatizations and democrati-
zation, surprisingly the new converts of privatizations extrapolated a
much more positive linkage than the workers with an anti-privatizations
attitude in Bursa. The latter saw privatizations as decreasing the social
status and economic well-being of workers, hence pernicious for
democracy. In contrast, the former focus group thought that "privati-
zations may bring democratization when and if workers' standard of
living can be improved over time" (Izmit, August 2005). These con-
trasting perspectives showed that privatizations were less important
than ideological and political allegiances in determining workers' atti-
tudes toward privatizations and their level of activity during and after
them. But, what about the vast number of workers who do not neces-
sarily subscribe to a strict political ideology, but who rather swing in
between the two far ends of the political spectrum? Would these
workers change their political perceptions of state-society relations or
the nature and level of their participation in the political system as
result of privatizations?
In this regard, the Istanbul focus group presented a different, but
equally important, effect of privatizations on workers : workers devoid
of any definite and strong political ideology, who lost their job as
a result of privatizations, became active in contesting the privatiza-
tions to regain their jobs . They did so only temporarily, however,
as their collective action subsided once a good enough compromise
was reached at the end of negotiations with the government and the
unions, and they were then allocated to different government institu-
tions as temporary public employees via the 4-C clause of law 657
starting with 2001. As such, the former workers of the SOE Turkish
Maritime Administration (Turkiye Denizcilik Isletmeleri, TDI) who
placed themselves in the center of the political spectrum and did not
subscribe to any given political ideology, discontinued their activism
upon recuperating jobs in the General Directorate of State Hydraulic
Works (Devlet Su Isleri Mudurlugu, DSI) .
The participants of the Istanbul focus group were former members
of a grassroots protest movement against privatizations started by the
downsized rank and file in Turkey. Called the Victims ofPrivatizations
(Ozellestirme Magdurlari, OM), the OM was a nonviolent protest
movement of workers and independent of union leadership support.
It was, however, very hard to keep the members of the movement
together once their mobilization paid off and they obtained new jobs .
As the founder of the movement, Unver, confessed "the lack of trust

by the adherents of the movement toward one another was so high
that it was impossible to maintain unity once the 4-C was legislated."
Unver and his small circle of friends in the OM sought to institution-
alize the movement by transforming it into a grassroots organization,
or alternatively, a "Union for the Victims of Privatizations." They
were then blamed by other members of "trying to squeeze money out
of them, just like unions have done!" (Ankara, August 2005).
The self-proclaimed leader of this movement, Unver, lost his job
after having worked for nineteen years in the previously state-owned
Petroleum Refineries (Petrol Ojisi) when the latter were privatized in
July 2000 . He decided to organize a movement of the rank and file
when its union stayed inactive during the first 19 months after the
privatization of his firm. When 4-C was legislated, he was assigned
to the Ministry of Health as a clerk. Unver's case shows, in his own
words:
An individual who is conscious politically and active civically continues
to be so with or without privatizations. Privatizations only constitute a
catalyst for more participation and social mobilization by necessity and
for a temporary period of time at best.
The Ankara focus group, of which Unver was a participant, also

involved two other downsized workers, Halil and Rasim. They were
the current members of the now more dispersed and less popular OM
movement. When asked why they were participating in such a social
mobilization, they answered "We would like to secure a stable job
and not be condemned to the informal markets forever." These two
former workers of the Lalapasa Cement Factory (Lalapasa Cimento
Fabrikasi) in Edirne.s! which was undergoing privatizations at the
time of the interview in August 2005, used their severance payment
to sustain their family after privatizations. They held various tempo-
rary positions in informal markets because they were not able to find
a stable job in the formal markets, nor did they really desire to do so
initially since this would mean that they would not qualify for the 4-
C clause.P They wrote letters and sent out several faxes to their local
representatives and to the Office of the Prime Minister until they met
Unver by pure coincidence. They then organized small-scale protest
movements in front of the building of the Privatizations Adminis-
tration (Ozellestirme Idaresi Baskanltgt, OIB) in Ankara, thereby
becoming the self-appointed regional leaders of the OM movement
from the region of Thrace.
What is interesting to note about the case of these two relatively

new OM members is that they put extreme emphasis on their on e-
time talk with Kemal Unakitan, the Turkish minister of economy,
who also happens to be a native of their hometown, Edirne . Using
their "village camaraderie," in their own language, the y were able
to obtain the word of Unakitan for their inclusion into the 4-C as
public ernployees.P They were now working to have the word put in
writing. It was clear from the accounts of these two victims of privati-
zations that they were in this political struggle only until obtaining a
new and secure job in the formal market, and not thereafter.
While the OM was a provisional social movement, it was uniquely
and directly about privatizations. Therefore, it presents a direct and
indisputable upshot of privatizations on social and societal grounds.l"
The OM was also one of the first overtly anti-union and entirely
grassroots-based social movements in Turkey, even though later on in
the struggle, when the popularity of the movement increased in the
eyes of the public , TURK-IS and HAK-IS leadership gave partial sup-
port. 35 As an innovative social movement, the OM was able to make
itself public through the use of various means of protest. Waiting in
front of the TURK-IS building in Ankara every day after 5:00 PM,
organizing for busloads of workers from all around the country to
come to Ankara for staging protests in front of government and
union buildings, organizing a big march from Istanbul to Ankara in
September 2002 were some of these new and innovative forms of
protest.j?
In all, the OM experience has been an important learning expe-
rience in the Turkish democratization process by (1) showing that
citizens from all over Turkey can mobilize around common goals and
projects; (2) putting pressure on the government and union lead-
ers; (3) acting collectively to voice demands publicly using effective,
peaceful , and diverse means of social protest; and (4) making effec-
tive use of the media to make itself heard on television and through
written means of communication. While smaller in size and influ-
ence, the links forged between the new victims of privatizations and
the employed founders of the OM have persisted. The OM members
staged a march from all of the Anatolian cities to Ankara in July 2006
to protest the 4-C clause."
Although the OM constitutes a temporary but important collective
action experience, the second Istanbul focus group has made clear that
privatizations had to be real and implemented to ignite workers' action .
That is to say that for workers who were still employed in the SOEs
lingering in privatization programs without yet being privatized, it was
virtually impossible to collectively organize against prospective privati-

zations. This was the case of the workers employed in the state-owned
Turkish State Monopoly on Tobacco (Tutun Mamulleri, Tuz vc Alkol
Isletmeleri, TEKEL) that has been in the privatizations program since
2001 .38 Although the participants of this focus group held a strongly
anti-privatizations attitude, they had not yet taken any concrete steps
toward a collective plan of action, were they to be downsized in the
upcoming privatizations. Faced directly with the threat of privatiza-
tions, why would these workers with leftist ideologies not take any
action? What could possibly explain their apathy?
Whatever the cause for the lack of action on the part of the tobacco
workers, it could certainly not be a lack of credibility vis-a-vis the
upcoming privatizations. TEKEL Tobacco had already reduced
employment from 67,000 in 1980 to 17,000 in 2004 (Akduran and
Senesen 2005, 9) . These workers had thus seen their friends leave the
company one by one in the long preparatory pre-privatizations phase.
Perhaps, one can look for an explanation in the ways in which priva-
tizations were carried out in other TEKEL plants . If their previously
downsized friends were perceived to be better off, or at least, not
worse off in their post-privatizations adjustment, these workers could
choose not to spend any efforts for mobilization. Indeed, TEKEL's
privatization program ensured that the downsized personnel be real-
located to other TEKEL plants throughout the country. One of
the participants in this focus group was a transferred worker from
TEKEL's alcohol-producing plant in Diyarbakrr privatized in 200l.
This finding, of course, is interesting in itself since it shows that
privatizations have resulted in waves of internal migrations of workers
and their families in Turkey. Although beyond the scope of this analy-
sis, such displacements have entailed various problems of cultural and
social adaptation for all family members, especially for those who have
had to move from the interior hinterland to industrial metropolitans
like Istanbul. Taskin Gundag, the secretary-general of the Union of
Food Sector Workers, confirmed
Privatizations have created a stressful and depressed Turkish society.
People were obliged to move from their single-family homes in the
agricultural interior to small apartments in noisyand unfriendly metro-
politancities like Istanbul,Tokator Samsun. In some cases, two or three
families share an apartment due to the high living costs in these cities.
(Istanbul, July 2005)
The lack of action on the part of the workers until the moment of
actually losing a job was corroborated by the in-depth interview
conducted with Kadir, a Telecom employee, who placed himself at

the center of the political spectrum. Turkish Telecom (Turk Telekom)
was bought by a consortium led by Saudi Arabia' s Oger Telecom at
the time of the interview in 2005 . The very next day after the sale,
workers in none of the call centers all over Istanbul had organized or
taken any action to contest the privatizations. As Kadir stated
We could potentially do so if we lose our job . We will first wait to see

the end of the union negotiations and take it from there .
(Istanbul, September 2005)
To summarize, focus groups, in-depth interviews, and survey

questionnaires have made it clear that Turkish workers have responded
in three distinct yet mutually inclusive ways to privatizations:
individualfamily) clientelist-party, and collective-social.
Individual Solutions Using Family Connections

Although not visible in the outputs of the focus groups, previous
research by Tansel (1998) has shown that most Turkish workers
who lost their job as a result of privatizations were those who were
close to retirement. These people accepted the generous retirement
packages and severance payments coupled with seniority compensa-
tion (kidem tazminati).39 The typical post-privatization activity of a
retired worker as a result of privatizations was to return to his or her
hometown in Anatolia and become a shopkeeper or a taxi driver or
a farmer cultivating his family land. In case these investments went
awry, which fortunately was not frequent, these former workers would
then rely on family support. Since most of the Turkish workforce also
own land in less industrialized parts of Turkey, additional revenues
and/or food from their land would be enough to get by on through
the transition period between the privatizations and the finding of a
new income-generating activity.
Clientelist Solutions Using Party Connections

Younger and more ambitious Turkish workers seem to have crafted a
new and a much more political strategy for coping with the deleteri -
ous effects of privatizations. The former workers of the Izmit-SEKA
paper plant, currently employed in the AKP-run local municipality in
the same city, used their party connections to obtain their jobs. As
a creative way to pressure the government to reinstitute their jobs
after privatizations, these workers went as far as to collectively cancel
their party membership when they were downsized. The AKP Izmit
branch rejected this request, and they were all promptly reassigned to
their new posts . It seems that using their party connections was the
most efficient and fastest way to recover a job lost as a result of priva-
tizations, given that the party in question was in the government.'?
These workers also shifted their stand on privatizations from being
nonbelievers to being believers in privatizations.
Collective Solutions Using Social Mobilization

This was the most arduous yet socially and politically vibrant way of
responding to privatizations. It took a lot of hard work, courage, and
time to organize against a bulwark of established institutions such as a
privatizing government, well-organized business groups, and overtly
or implicitly complying unions. Union leaders did not want to share
the lists of the unemployed, which would have facilitated information-
sharing and collective organization. Moreover, they did not like the
fact that a few workers were thinking about self-organizing to protest
the privatizations of which most union leaders were part in one way
or another. The government personnel responsible for privatiza-
tions complained about the absurdity of some claims from workers
who were being displaced or relocated as result of privatizations.
Veysel Tekelioglu, the department head in the Privatization Adminis-
tration in Ankara , for instance, stated
There are workers who are coming to see us or are bombarding us with
faxes asking us to change their jobs so that they can be included in the
4-C. They want to change their jobs because of some trivial reason
such that the new private owner does not let them park their carsclose
to the plant anymore,this causingthem to walk to work. They saythey
preferhaving more vacation and less money but continuing to workfor
the state, and not a private owner.

LEVEL OF INDIVIDUALS: PATHS AND CAVEATS
This research carried out in different cities across Turkey with blue-
collar workers active in sectors as diverse as tobacco, auto, petroleum,
cement, ports, and paper and affiliated to union confederations of
diverse political tendencies has shown that ideological convictions
more so than cost-benefit analyses have determined workers' reactions
to privatizations. While political ideology has a sway in determining the
nature and degree of social and political action vis-a-vis privatizations,
all of the workers included in this study regardless of their union

affiliation or political standing were against privatizations emotionally,
except for the right-wing former state employees who turned into
pro-privatization actors after obtaining jobs. This change in position
was also in line with the ideology of the political party, the right-wing
AKP with an Islamic pedigree, of which they were active members.
Finally,all workers ceteris paribus seemed to avoid any kind of planning
or organization before the privatizations really hit them. The idea and
prospects of privatizations, in other words, were not sufficient to incite
any concrete action or mobilization on the part of workers.
I complemented the focus groups with a short survey question-
naire on the relationship between privatizations and the consequent
sociopolitical activity on the workers' part. The latter showed that
privatizations do not seem to have a significant effect on the voting
decisions of workers . None of the surveyed 28 workers responded
"yes" to the question: "Have privatizations led (or might lead) you to
change the party you have voted for in (the last) elections?" This find-
ing runs counter to the initial hypothesis of this study that privatiza-
tions should stimulate the rank and file to change its voting behavior
as a way of protesting the privatizing government for the sudden fall
in their income levels and standard of living. This finding also sup-
ports Yilmaz Esmer's (2002) conclusion that the first and foremost
factor molding the Turkish voter's behavior continues to be the left-
right ideology (1l0) . One can safely assume therefore that religious
values and nationalist sentiments continue to be better predictors
than relative deprivation, economic well-being, or income for voting
patterns in Turkey,"!
These findings on privatization's lack of influence on political
behavior such as voting or social mobilization do not mean that
privatizations are superfluous politically. One major finding of this
analysis is that privatizations have indeed generated a provisional
but vibrant social movement of the Turkish rank and file, due
mainly to the workers' perception of the unsatisfactory handling of
privatizations by labor union leaders. In other words, privatizations
have increased the lack of trust between the rank and file and union
representatives, thereby driving the former to take their destiny into
their own hands and to mobilize outside the scope of unions . Such
national mobilization and organized protest movements by the rank
and file have had the pragmatic aim of securing jobs in the formal
labor market. Thus, the maxim for a typical Turkish worker overall
has remained, "Being a member of the worst union is still better than
not being a member of any union at all."
CONCLUSION: IMPACT OF PRIVATIZATIONS ON

UNIONS AND WORKERS IN TURKEY
The analysis of the impact of privatizations on Turkish labor
shows that labor institutions were greatly affected by them. As
result of privatizations, the Turkish labor unions became more
amenable to democratization. From the 1990s onward, Turkish labor
confederations and unions were (1) cooperating more with each other
and civil society organizations while at the same time keeping their
autonomy and moving toward a less hierarchical union structure; (2)
implicitly and explicitly supporting democratization and taking a clear
stand against attempts at reversing it; (3) giving in to the demands of
their rank and file and the unemployed, albeit to different degrees,
to support, or at least, not to forge a barrier against, new formations
outside the scope of the unions; and (4) searching for innovative ways
to adapt to the changing economic imperatives of a globalized world.
One reason the Turkish unions were engaging in these activities is
because privatizations and their perceived or real negative impact on
unionization and employment forced them to find new ways of doing
union politics. As such, the negative consequences of and expecta-
tions about privatizations, and not the privatizations per se, acted as
an invisible hand in producing the unintended changes in question in
the Turkish labor movement.
The analysis of the impact of privatizations on Turkish workers
shows that the effects of privatizations on individuals are not strong in
the long run . While privatizations rarely change the political activity
and the nature of participation of workers affected by them, individu-
als who were active politically and socially before the privatizations
continue to be so after the privatizations. Although the vibrant
social movement of the Victims of Privatizations was formed and
spread throughout the whole country, the undertaking in question
dwindled, without coming to a complete halt, once the desired end
of obtaining a job in the formal markets was reached. The initiative,
however, came from the masses, and despite union leadership, and
constituted an important learning process of social mobilization.
Privatizations are not the only factors influencing the develop-
ment of labor unions and the attitudes of workers . An alternative
and highly plausible explanation for labor union developments can
be the "historical model oflabor unions" in a given country (Goldin
2001). One way to strengthen the hypothesis that privatizations are
at the cause of the various structural, institutional, and attitudinal
changes in the labor movement in the post-privatization period is to
compare the findings from the Turkish case with a different historical
labor model. Ideally, this second labor model should be as far away
as possible from Turkey, geographically, culturally, and historically.
Argentina constitutes such a case where the effects of privatizations
on labor can be examined from a comparative perspective.
CHAPTER 5
ARGENTINE LABOR
IN THE GLOBAL ERA
MORE PLURAL UNIONS AND ATOMIZED WORKERS
Effects ofprivatizations on Argentine labor unions and workers have

been manifold. At the institutional level, the General Confederation of
Labor (Confederacion General del Trabajo, CGT) was fractured into
groups of labor organizations that have taken separate and distinct
approaches to privatizations, including diverse strategies of collective
action and revenue generation. Privatizations also have generated
an increase in stateness! by breaking the organic ties between union
leaders acting as the managers of SOEs and the government. Finally,
a new union leader has emerged at the local level of representation
with a broader horizon, stronger educational background, and more
ambitious plans of both personal and organizational advancement.
The divisions within the union structure have coincided with the
distinct attitudes adopted vis-a-vis privatizations. Some unions have
taken on a more active and civic type of unionism , becoming involved
in extensive social and economic research on privatizations and crafting
less violent, more creative, and diverse types of social protest. Others
have compensated for their loss of political prominence without break-
ing their ties with the Peronist ideology or government, hence keeping
the patron-client type of arrangements that have long characterized
the Argentine system of labor relations. Another group of Peronist
unions with a historically more independent attitude toward Peronism
has adopted a more professional and less ideological style of negotia-
tion with the reforming government and the private sector. Many of
those unions have pushed for the democratization of the political

system. Unions affiliated to the CGT have not been as vociferous about
the democratization process. Nevertheless, they also have included
demands ofdemocratization in their discourse and projects much more
so in the privatizations and post-privatizations periods than before.
While privatizations' impacts have not reached the level of internal
functioning of the labor unions, they have facilitated the rise of a
new type of local union leader. The new leader understands that in a
period where privatizations are either happening or have happened,
union representatives need to be aware of the productivity of their
plants, and the financial markets in general, in order to keep track of
the value of workers' shares in privatized enterprises. The new union
leader of a pro-privatizations union at the local level tends to be more
educated, younger, more pragmatic, and less ideological. In a similar
way, the new union leader of an anti-privatizations union at both the
local and the national levels is more open to dialogue with different
ideological tenets, more active in social and political domains, and
well-versed in current research on privatizations and development.
At the individual level, privatizations' impact on democratic
attitudes and perceptions has not been significant. The main
determining criterion for what an Argentine worker should do in the
post-privatizations period seems to be determined principally by the
degree of his previous participation in union affairs, and less so by
variables such as education, cultural outlook, or historical connec-
tions . This finding is important because 15 years ago, Peter Ranis
(1991) had found that these innate variables were the most import-
ant determinants of workers' views on democracy in Argentina. My
research shows that today, they seem to matter less. Instead, being
a member of a labor union and the degree of activity in it appear are
critical. I call this characteristic "unionismo."
If it was partisanship, including the left-right political ideolo -
gies, which determined how individual workers would react to and
deal with privatizations in Turkey, in Argentina it was unionismo.
The Argentine rank and file tends to be unionist, meaning that they
have emotional and ideational attachments to labor unions and they
are active in them. This is different from partisanship, where the emo-
tional and ideational attachments are with political parties situated
on the left-right political spectrum, not unions. If loyalty to political
parties was the main determinant of the perception of and attitude
toward privatizations in Turkey, loyalty to unions was in Argentina.
Accordingly, unionist and nonunionist workers reacted differently to
privatizations in Argentina. Most nonunionist workers, that is, those
ARGENTINE LABOR IN THE GLOBAL ERA 125
nonaffiliated workers and workers who only paid their dues without
participating actively in union activities, resorted to "individual or
family networking" solutions to deal with the negative consequences
of privatizations, such as the loss of a job or downgrading in one's
position. Accepting large sums of compensation money within the
scheme of voluntary retirement packages (retiro voluntario), many
older nonunionist workers moved to the interior of the country,
where the cost of living is relatively lower. The younger and the
more educated nonunionist workers, on the other hand, chose either
to migrate to European countries in search for a better future or to
pursue their hobbies professionally.
Most unionist workers, that is, those workers who were active in
their respective unions, both in top positions or those acting as floor
representatives, were usually protected from the negative impacts of
privatizations in Argentina. Unionist workers kept their jobs and their
positions within the union in the post-privatizations period. Relatively
younger, more ambitious, and Peronist unionists used privatizations
to engage in entrepreneurial activities with the political and organiza-
tional support of their unions. Such workers grew richer, both finan-
cially and professionally, by privatizations. They did so because they
acquired training, they continued their education in relevant fields,
and some of them established small-scale businesses using the small
loan programs of privatizations called the microemprendimientos.
The unionist workers of pro-privatization unions thus applied the so-
called organizational/entrepreneurial solutions toward privatizations.
The unionist workers of anti-privatization unions, on the other hand,
kept their positions within their unions and continued their activism
against privatizations.
In the case of Argentina, as opposed to Turkey, privatizations did
not produce any large-scale social movement or organization on the
part of workers affected by them. Individual solutions for those out-
side the union framework and union-related solutions for those inside
it dominated. Only one social movement called the Black Gold (Oro
Negro, ON) was detected by this study. The ON was started by the
downsized Argentine workers of the previously state -owned company
of petroleum, Fiscal Petroleum Fields (Yacimientos Petroliferas Fis-
cales, YPF), now called Repsol. This movement, however, was distinct
from the Victims of Privatizations (OzeUestirme Magdurlari, OM)
movement in Turkey on many grounds.
A comparison of the OM in Turkey and the ON in Argentina shows
that the latter came into being a decade after the actual privatization
of the plant in question, while the OM in Turkey was a spontaneous
reaction to the massive downsizing that occurred during the privati-

zation of the same energy sector. Second, the ON in Argentina aimed
at the renationalization of the energy sector as a whole, while the OM
in Turkey did not target more than the landing of formal jobs for its
adherents. Third, the ON in Argentina was quickly institutionalized
and got affiliated with the unofficial labor confederation, the Central
of Argentine Workers (Central de los Trabajadores Argentinos, CTA).
This is in contrast to the experience of the OM in Turkey where the
movement stayed as a loose and informal association ofself-appointed
regional leaders. The ON experience corroborated, among other
things, the notion that "collective and social solutions" were pos-
sible in Argentina only within the framework of union structures, not
outside.
The counterintuitive finding at the individual level of analysis
in Turke y as well as in Argentina is that the impact of privatiza-
tions on income and social class does not translate into a changing
level or nature of political activity for those affected by them . The
Argentine workers interviewed for this study felt the overwhelm-
ing power of the Argentine labor unions to such a degree that any
type of collective action outside of union support or leadership was
almost unthinkable for them. The reasons for this paradox might
derive from the historical and institutional legacies of the Argentine
political system. It might also have to do with how privatizations
were applied in Argentina. Following these premises , the first part
of this chapter deals with the implementation of privatizations in
Argentina. The second part attempts to connect the privatizations
with the changing structural features of the Argentine labor move-
ment. The third section deals with the impact of privatizations on
individual workers and how they have tried to cope with privatiza-
tions. The chapter attempts to locate the causal mechanisms that
operate between privatizations and the consequent changes in the
Argentine labor force and institutions.
THE BACKGROUND OF PRIVATIZATIONS:

PRE-PRIVATIZATIONS PERIOD IN ARGENTINA
As in Turkey and the rest of the developing world, Argentina
applied lSI policies prior to privatizations. The populist leader
Peron, who had become president of Argentina by 1946, launched
his first Five-Year Plan in 1947. The plan nationalized large parts
of the economy, while putting up significant trade barriers. Peron
also decreased the prices of consumer products and implemented
policies supporting the working and lower-income classes. Among

these polices were the overvaluation of the peso, easy credit, and
negative interest rates . The consequent expansion of the role of the
state and government expenditures increased inflation . A series of
economic and political conflict led to crisis, and Peron was ousted
by the military in 1955 (Gerchunoff 1989).
The post-1955 military rule, which lasted on and off until the brief
prelude of Peron's return to the political scene in 1973, consisted of
stop -and-go policies of stabilization and state involvement in eco-
nomic affairs with the aim of promoting industrialization. Radical
Arturo Frondizi's first civilian government of 1958-1962, the first
to follow the 1955 military coup, worked on deepening the import-
substitution regime by investing in heavy industries and repudiating
any export-based economic initiatives (Petrocolla 1989). The civilian
government of the Radical Arturo Umberto Illia, the last before the
second coup of 1966, shifted gears with the aims of controlling infla-
tion, establishing ties with foreign capital, and eliminating subsidies
to the agricultural and oil sectors . Private industry was rarely, if at all,
accorded a central role in the economy (Guadagni 1989).
Inconsistent policies went hand in hand with unstable governments
and periods of military rule. In March 1967, General Juan Carlos
Ongania's government devalued the currency by 40 percent per U .S.
dollar in order to put a stop to inflation in the short run, to attract
foreign investment, to encourage competitive industrial production,
and to promote exports of manufactured products. This stabilization
program reduced the budget deficit and increased public savings
(Datas -Panero 1970, 67) . Due to factors such as the structural
weaknesses of the economy, the fixed exchange rate and the world
meat crisis, however, the program ended in failure in 1970. General
Alejandro Lanusse, who gained power in March 1971, declared his
intention to restore constitutional democracy by 1973.
In March 1973, general elections were held . Peron was banned
from running, but a stand-in candidate, Hector Campara, was elected
as the president. Less than a month after Campora took office, Peron
returned from an 18-year exile in Spain. The Peronist government of
1973-1976 followed policies diametrically opposed to the preceding
military government's program of fiscal and monetary contraction.
Coupled with the negative repercussions of the worldwide oil crisis,
Peron's expansionary policies culminated in rampant inflation. As a
result, social unrest grew (Terragno 1974).
The military coup of 1976 was about eradicating the populist
Peronist ideology and repressing its adherents (Di Tella 1989).
The economic tool of doing so was to make a definitive turn from

the lSI to the EOI model. Charles Blake (1998) classified the eight
years of military rule in Argentina (1976-1983) into two distinct
economic periods. The first phase from 1976 to 1980 marked an
improvement over 1975 in terms of inflation rates, investment
rates, and the average annual GDP growth rate . Trade liberaliza-
tion and a limited liberalization of capital markets were undertaken
(Sjaastad 1989). Nevertheless, government expenditures continued
to increase along with foreign debt. It was not a surprise when the
second phase of the military rule, from 1980 to 1983, brought rapid
economic deterioration. Much like in Turkey, the previous capital
liberalization introduced by the military government caused massive
amounts of capital flight in Argentina. This was financed through
borrowing from abroad and by cutting workers' wages. Rudiger
Dornbusch (1989) identified external debt and inflation as the two
main culprits of the economic troubles during the final years of the
military regime before the latest transition to democracy in 1983 .
As opposed to Turkey, where the 1980 military intervention
recorded some success on the economic plane, the Argentine experi-
ence was a total disaster. In the wake of its economic collapse, the
Argentine military invaded the Malvinas Islands in April 1982 as
a last resort to dissipate public dissatisfaction by shifting the focus
to nationalism. This approach was much more dangerous than the
Turkish military's relatively smooth resignation of power before the
institution of elections in 1983. In both cases, however, the military
was unsuccessful in entirely converting the model of economic devel-
opment from the lSI to the E01. In Argentina, to top it off, the
military was unsuccessful in its endeavor to curb the power of the
Argentine labor unions. In Turkey, the military regime had effectively
accomplished its objectives on that plane.
Argentina's predicaments in transitioning from the lSI to the
EOI model had to do, to a large extent, with the entrenched statist
ideology (Whitehead 2000; Baer and Hargis 2000; Gereffi and
Wyman 1990). Hector Mairal (1996) has argued that since Peron's
nationalizations in the 1940s, Argentina has adhered to the French
model of service public (SP), or public service, in organizing its
economic relations. The SP model is based on the assumption that
the operation of public utilities is a government or administrative
function, while the government itself is nothing but a "cooperative
of public services". This principle was incorporated into the 1949
Argentine Constitution: "All assets and businesses whose operations
ARGENTINE LABOR IN THE G LOBAL ERA 129
have or acquire the features of a national public service, or of a de

facto monopoly, must become the property of the community at
large" (136). The French model, which also constitutes the principal
source of the Turkish statist ideology, conceived the state principally
as a social benefactor, rather than an impartial watchdog.? Both in
Argentina and in Turkey, therefore, the state controlled the major
public services such as electricity, gas, oil, and communications; it also
owned banks, financial institutions, and insurance companies prior to
privatizations. In Turkey, however, private enterprise was veneered
and conceived as the ultimate end of the state-led development
project. This was seldom the case in Argentina.
The above analysis shows the following convergence points
between the pre-privatizations periods in Argentina and Turke y:
(1) the lSI as the dominant model of economic development; (2)
statism as the main ideological justification for the lSI model of eco-
nomic development; (3) the French, as opposed to the Anglo-Saxon
model in conceiving the role of state in society; and (4) highly state -
ownership-dominated economies. Coupled with the political instabil-
ity and social unrest caused by the successive military interventions
that had plagued them both, Turkey and Argentina started playing
with the idea and practice of privatizations in an unhurried manner.
It took some time for the first civilian governments of Ozal in Turkey
and Alfonsin in Argentina to implement the ir respective projects of
privatizations starting with the mid-1980s.
SUMMARY OF ARGENTINE PRIVATIZATIONS:

PLANNING AND IMPLEMENTATION
Although Argentines tend to equate the name of the Peronist Presi-
dent Carlos Menem with privatizations, it was the previous Radical
President Raul Alfonsin, who started the preparations for privatiza-
tions in Argentina. One can therefore take 1983 as the start date of
Argentine privatizations. Alfonsin's government was unsuccessful in
this endeavor, as it was in many of its economic undertakings. There
were several reasons why Alfonsin failed in his attempt at privatiza-
tions: (1) his electoral campaign and presidential mission focused
more on political democratization than bringing economic recovery
per se; (2) his understanding of democracy was much more about the
"distribution of resources" than their privatization; (3) his attitude
toward the powerful labor unions was confrontational and empha-
sized their alleged lack of democracy and excessive privileges; (4) his
political circle consisted of politicians who were mostly of the old
school and not willing to sacrifice their special status and privileges;
and (5) his rule was extremely difficult since his government never
had the majority in the Senate and also lost the congressional majority
as early as 1987, this leaving him with the serious problem of a
"divided government" in a strongly presidentialist system (Campione
and Munoz 1994).3
Like the first law of privatization, law 2983 of 1984 in Turkey,
which differentiated between the SOEs that were involved in public
services (KIKs) and those that were not (IDTs), Alfonsin's first
legal attempt at privatizations with the decree 414 in January 1984
was to identify and differentiate the SOEs that provided services of
national or social interest from those that did not. Like in Turkey,
Argentina decided that only the second group of SOEs was swiftly
to be returned to private ownership. As a result, only a few minor
privatizations were carried out under Alfonsin's administration: Siam
(an industrial conglomerate), Opalinas Hurlingham (ceramics), and
Sol Jet (a travel agency) . As in Turkey, the initial sluggish pace of
privatizations in Argentina led to the privatization of Austral Airlines
as late as in 1987 (Llanos 2002, 51). Other privatization attempts
were blocked by the Peronist party-dominated Congress and Senate .
The 1980s, for Argentina and Turkey, can therefore best be charac-
terized by slow structural reforms driven essentially by populist and
heterodox policies.
The second legal attempt at privatizations in Argentina came in
1986, when Alfonsin's minister of economy declared that the tradi-
tionally strategic sectors of the petrochemical and steel industries,
where the state had always dominated, would be taken into priva-
tization program. This constituted the first time in Argentina that
the French model of "service public" was being abandoned in favor
of a model of "free-markets". The bill organizing the proposed
privatization procedures, and the extension of executive powers to
carry them out, was submitted to the lower house in October 1986.
This bill, like the Turkish decree 233, contained some contradictory
clauses. While privatizations in the public service area were now
encouraged, the state could still intervene in the determination of
prices in Argentina. Furthermore, the SOEs operating in the areas
of telephones, postal services, the railway system, television, and
basic production such as gas, oil, coal, and hydroelectric power
were still explicitly excluded from privatizations, while the national
defense sectors of petrochemicals and steel were given a green light.
The 1986 bill did not pass through the Argentine Congress (Mairal
1996,53).
Two new bills were sent to the Senate in 1988. They proposed
and outlined the privatization of Argentine Airlines (Aerolineas
AllJentinas) AA) and the National Telecommunications Company
(La Empresa Nacional de Telecomunicaciones, EnTeI), that is, the tele-
phone company, which only two years earlier, had been designated as
a sector to be shielded from privatizations. These privatizations were
to be partial in that the state could not sell all of its shares. Like the
two previous legal undertakings on privatizations, these privatization
laws were parallel to the third and the principal privatizations law in
Turkey, law 3291 of 1986, which stipulated that once government
shares in the SOE to be privatized dropped below 50 percent,
privatization would be deemed complete. In contrast to Turkey, the
Argentine Senate never approved these bills.
It was not only the Argentine Congress that opposed privatiza-
tions in their initial stages during A1fonsin's government. Unions,
along with the entrepreneurial sector, were also very much in
opposition to the privatization efforts in this period. Once again,
much like in Turkey, unions were concerned with maintaining their
established privileges, as were the business sector and the state
bureaucracy. In 1987, therefore, the Argentine unions were in
permanent mobilization, organizing national and sectorial strikes
against privatizations. Failure to deal with the rising economic diffi-
culties and the rampant social discontent fueled by hyperinflation led
to the Peronist politician Carlos Menem of the Justice Party (Partido
]usticialista, PJ) taking over the presidency six months before the
scheduled date in 1989 .
The actual implementation of the privatizat ions did not happen
until the 1990s in Argentina. This was no different than in Turkey.
The only difference was that it took a turnover of power in Argentina,
from A1fonsin's Radical government to Menem's (neo )Peronist
Justicialista administration, for privatizations to start. In Turkey,
on the other hand, the center-right Anavatan Party's leader, Prime
Minister Turgut Ozal, stayed in power and continued to press for-
ward with his neoliberal restructuring of the state -led economy in the
1990s. Compared with Menem, Ozal did not do as good a job in
this domain. That is why after 1989, we see a significant divergence
in the pace and pattern of privatizations in Turkey versus Argentina.
Starting with the 1990s, Turkey becomes the sluggish, and at best,
the gradual privatizer, while Argentina becomes the speedy and vigor-
ous privatizer. Both countries, however, show accelerated patterns of
privatizations in the 1990s compared with their previous performance
records individually.
Ziya Onis and Metin R. Ercan (2000) suggest that the reason the
Turkish privatizations of the 1990s recorded only a limited achieve-
ment in terms of the scale of implementation and the realization of
the efficiency objectives was because Turkey never had as serious an
economic crisis as Argentina's 1989 hyperinflation. They suggest that
the Argentine 1989 economic crisis and the preceding economic
problems since the end of the lSI in the mid-1970s were much longer
in duration and stronger in intensity than in Turkey. They argue that,
as a consequence, Argentines supported privatizations much more
robustly than Turks since the y perceived privatizations as almost a
panacea to their endemic economic tribulations, at least initially.
While the argument ofthe impact ofthe degree ofpre-privatizations
economic crisis on the nature of the privatizations is plausible, one
should bear in mind that the intensity of economic crises is hard
to gauge . Crises are perceived differently by members of different
societies due to their divergent past experiences and future expecta-
tions . Miguel Kiguel and Nissan Liviatan (1995) argue, for instance,
that the hyperinflationary periods in Latin America are not what
hyperinflation implies in general since, having had several of them,
Latin American governments and societies have devised efficient ways
to cope with them." Ergo, it might very well be that the relatively
milder economic crises in the pre -privatizations period in Turkey,
were perceived as negatively by the Turks as was the hyperinflation
by the Argentines.
Sebastian Galiani and Diego Petre colla (2000) divide the Argentine
privatization period of the 1990s into four subphase s. Accordingly,
the first phase had as its primary objective the lessening of the mas-
sive public external debt and promoted the use of debt-equity swaps
in privatizations. The latter sought to guarantee the buyers a high
profit due to the underpricing of assets and other incentives offered
in profit-making SOEs, which mostly operated in monopoly sectors .
The first stage of Argentine privatizations in the 1990s ended with
the announcement of the Convertibility Plan in 1991 . The plan,
which also initiated the second stage of privatizations, established the
exchange rate as the nominal anchor of the new stabilization program
and eliminated the practice of the indexation of wages to the rate of
inflation . The Convertibility Plan also limited the ability of the Cen-
tral Bank to create money through the expansion of domestic credit.
The third stage of privatizations started with the signing ofanother
plan. The Brady Plan, signed with the IMF in December of 1992,
aimed at decreasing Argentina's external debt and contributed to the
rise of much-needed foreign direct investment. As a result, financial
goals were much less important than those of efficiency and competi-
tion in the third stage of Argentine privatizations, as opposed to the
first and the second stages. During the fourth stage, starting in 1995,
financial priorities made a slight return due to short-run cash con-
straints that had reemerged during the second Menem administration
(1995-1999).5
Each one of the four privatization phases in Argentina was
characterized by aggressive implementation. By the mid-1990s
almost all public utilities and industrial enterprises had been priva-
tized. The total gains derived out of privatizations between 1991
and 1996 amounted to US $14.2 billion. The need to get out of the
hyperinflationary period required, according to the principal architect
and epitome of privatizations, President Menem, regaining the trust
of the business community (la comunidad de negocios) .6 To do that,
two simple but radical actions were to be undertaken: one was to
break off the interclass alliance forged between the wage earners and
the local bourgeoisie during the preceding lSI period. The second
was to transfer the most important and valuable SOEs to the busi-
ness sector to raise revenues and foment the trust of the international
financial markets and organizations. In other words, the "inter-class
alliance" based on the "internal demand" from the domestic markets
and driven by the lSI was to be substituted with the "within-class alli-
ance" based on the "external demand" from the international markets
and determined by the Ear (Arceo and Basualdo 2002) .
With these economic aims and the project of building a new
political power base in mind, Menem acted quickly. Law 23 .696 on
Economic Emergency (Eme13encia Economica) and law 23.697 of
the Reform of the State (Reforma del Estado) were legislated during
the first months of his administration. The first law dismantled the
regimes of subsidy and industrial promotions associated with the
state -led economy. As such, the first piece of legislation aimed at
modifying the role of the state . The second law conferred full power
to the executive so that it could undertake privatizations and deter-
mine their conditions unilaterally. These two pieces of legislation, like
law 2983, decree 233, and law 3291 in Turkey, ended up constituting
the legal-structural basis for the subsequent implementation of the
privatizations.
The privatizations of the state-owned EnTel and of the AA came
first. These were two of the most lucrative sectors in the state-owned
Argentine economy. They were also the most important ones in
terms of their political and symbolic power since they constituted
the seeds of the Peronist Party in the eyes of the business community
(Azpiazu 2003, 180). EnTcl was privatized in 1990. The monopoly

of the state-owned phone service was split into two territories: France
Telecom was given the "upper half" of the country, from the middle
to the north, and Telefonica of Spain was given the southern part.
Each company was accorded an initial monopoly ofseven years, which
they were allowed to extend given the approval of the government.
Telecom and Telefonica recorded high levels of profit following
the privatizations, despite the equally high levels of investment in
technology and services (141). Their monopoly of the telecommu-
nications market was strengthened after the complete deregulation
of the sector, including the sale of cell phones and services of long-
distance calls (Ynoub 2007).
Along with EnTel, the AA was also privatized. The AA was sold to
the Spanish state-owned Iberia in 1990. The low price paid by Iberia
as well as the subsequent mismanaging of the firm by this Spanish
state-owned company drew many criticisms, including accusations
of corruption. The minister of welfare and public services, Roberto
Dromi, who was in charge of the privatization of the AA at the time,
said that it was shameful for a country like Argentina to have sold its
national airlines to another state (Rey 2003,38) .
Like the cases of EnTel and AA, the first privatization projects
for the Argentine Railways date back to the 1983-1989 Radical
government of Alfonsin . The then opposition PJ stood against
the privatization of this sector as it did against the privatization
of the telecommunications and airline sectors. Ironically, once
in power, the PJ went full speed ahead with privatizations. The
Argentine Railways (Ferrocarriles Argentinos, FA) were privatized
in September 1989 . The privatization of FA was unique in that rail-
ways were not a profitable sector. Bernardo Neustadt, a well-known
Argentine television reporter, had become legendary for starting his
weekly programs by solemnly stating that the railways were losing
one million pesos as he spoke. Concessions of thirty years or more
to municipal and provincial governments as well as to the private
sector were the preferred methods of privatization in this sector. In
the face of opposition and consecutive strikes by the railway work-
ers, many lines were closed either until the actual implementation of
privatizations or forever due to their alleged lack of profitability. As
a result of the privatization of the railway system, the total network
of functioning railway lines in Argentina decreased from 35,000 to
8,500 kilometers, as did the number of railway workers from 95,000
to 15,000 (Veschi 2006) .7 When Menem said: "Ramal que para,
ramal que cierra," he meant it. 8
The lack of adequate regulatory mechanisms and the supremacy

of political over economic concerns dominated the privatization of
railways in Argentina. The same problems dogged the privatization of
the water sector. The privatization ofwater started in 1991 and ended
in 1993 with the transfer of National Water Works (Obras Sanitarias
de la Nacion, OSN) to the consortium, Argentine Water Inc. (Aguas
Argentinas S.A.), composed of Suez Lyonnaise des Eaux-Dumez of
France and the local firm, Soldati . Prior to the transfer, the Argentine
government considerably increased tariffs both in terms of real prices
and the taxes collected on water service, called the Impuesto al Valor
Agregado (IVA). S.A. was the consortium that offered the highest
decrease in tariffs, even though the latter was renegotiated many
times after the actual privatization, with the ultimate increase in
consumer prices. The private firm's noncompliance with the clause
of mandatory investments listed in the concession contract? and the
consequent dearth of the basic sanitary conditions in the provision of
water services culminated in the renationalization of water in 2006 .
In addition to the lack of adequate regulatory mechanisms and
the dominance of political over economic concerns in the implemen-
tation of the privatizations, a third common feature of Argentine
privatizations was the segmentation of sectors toward extreme cen-
tralization and concentration of ownership. This can clearly be seen
in the privatization of the energy sector. The privatization of the
state-owned Gas of the State (Gas del Estado), the Electricity Services
of the Province of Buenos Aires (Servicios Electricos del Gran Buenos
Aires, SEGBA-distribution, generation), the Northern Patagonia
Hydroelectricity (Hidroelectrica Norpatagonica, Hidronor-genera-
tion, transmission) and Water and Electric Energy (Agua y Energia
Electrica-generation and transmission), and Fiscal Petroleum Fields
(Yacimientos Petroliferas Fiscales, YPF), were all tainted with explicit
drives toward the formation of either oligopolies or monopolies
(Azpiazu 2003) .
The gas sector, privatized in 1993, was divided into two distinct
zones controlled respectively by the Spanish company Repsol-YPF
and the local group Perez Companc in the south, and the foreign
conglomerate Techint with predominantly Argentine capital and
the national group Soldati in the north. The electricity sector,
which was segmented into the three subsectors of generation,
transportation, and distribution, also led to the concentration
of power. The 1997 takeover of the Spanish firm Endesa by the
Chilean group Enersis brought the latter to control 90 percent of
Edesur SA, the electricity distribution company in the south of the
capital Buenos Aires. The Secretariat of Defense of Competition

took up the issue of the illegal concentration of assets as late as in
2000 . This was three years after the illegal expansion (ibid., 161).
Finally, the 1991 privatizations in the petroleum sector brought to
the fore the same firms dominating the electricity and gas sectors.
As of 2000, Repsol controlled more than half of the production of
crude oil. Perez Companc and Chevron's shares were 10 percent
each, Pan American's were 8 .6 percent, and Tecpetrol's shares were
5 percent. Altogether they controlled 82 .8 percent of crude oil
production, creating an almo st perfect oligopoly. Clearly, therefore,
the Argentine privatizations in the energy sector brought "not the
deregulation of the markets but their regulation by a few big firms
and partners" (ibid., 179).
The final sectors to be privatized under Menem were the postal
service and the airports. Both sectors were given out as 30-year
concessions via national and international offerings . The Argentine
company Macri won the bidding for the postal service, and the
Argentine group Eurnekian obtained control of the airports of
Ezeiza, Jorge Newbery, and the other 31 Argentine terminals by
1997. These privatizations were also dogged by a persistent lack
of investment, rumors of corruption, and insufficient monitoring.
Macri had stopped paying its annual concession dues after 1999. It
owed the Argentine state almost three hundred million dollars by
the time it publicly declared bankruptcy. Macri defended itself by
arguing against the too-powerful labor union in the postal service
sector and citing the fierce competition presented by a multitude
of private postal companies that had mushroomed throughout
the country in the wake of the privatizations. The Argentine postal
service, like that of water, underwent renationalization in 2003 by
Kirchner's government.
In the case of the airports, as in the rest of the privatization trans-
actions in Argentina, concession owners renegotiated the original
contract, as well as the associated requirements concerning invest-
ments. The concessioners of the airports also ended up owing mil-
lions of dollars to the Argentine state due to their noncompliance
with the payment of the mandatory annual concession fees and the
pre-fixed levels of required investments. Dr. Roberto Dromi, who was
in charge of the privatization of the Argentine Airlines (AA) in 1989,
and who had become the lawyer of Argentine Airports (Aeropuertos
Awentinos) by 2000, said "Argentine airports will not pay what the
ENTEIO asks because the state is not complying with its part of the
contract to start with " (Azpiazu 2003, 212) .
The above analysis of the individual privatization transactions in

Argentina shows that the privatization process as a whole was tainted
with the increasing concentration of economic powers, a lack of
adequate regulation, serious noncompliance with the terms of the
privatization contracts and a lack of transparency in implementation.
A similar picture can also be found in the Turkish privatizations pro-
cess. Although Turkey applied privatizations gradually, the end result
was neither transparency nor adequate monitoring. Like in Argentina,
corruption allegations also dogged the privatization transactions
and public tenders there. I I Concerns regarding the concentration of
economic power and the creation of monopolies as a result of ina-
dequately regulated privatizations were also as prevalent in Turkey as
they were in Argentina. In fact, Erinc Yeldan (2005), in his report of
Turkish privatizations, characterized the latter as an episode of "surplus
transfer to capital-owners" (30) .
In addition to the similarities in the implementation of the priva-
tizations, Turkey also imitated Argentina in the governance style of
its privatizing leaders. Both Menem and Ozal extensively employed
coalition-building strategies and took recourse to technocratic style of
policymaking to implement the privatizations. Menem's State Reform
Law and the Emergency Law in 1989 allowed him to put technocrats
in charge of the privatizations . Ozal's discretionary budgets did the
same .P As for coalition-building strategies, Menem appointed as
ministers of economy Miguel Roig and Daniel Rapanelli from the
largest Argentine multinational, Bunge and Born, and made a coali-
tion with the small center-right pro-liberal party Union of the Demo-
cratic Center (Union del Centro Democratico, UceDe), with the aim
of garnering the support of Argentina's entrepreneurial groups.
This coalition-making strategy was similar to that used by Ozal in
appealing both to the traditional sectors of society using religious
symbols in his discourse and siding with the national bourgeoisie in
his liberal approach to economic relations . 13
Unions were another important group targeted by Menem and his
co-optation techniques in implementing the privatizations in Argentina .
Offering financial and political privileges for union leaders' support,
Menem succeeded in dividing the strong labor movement in Argentina
into unions that were for or against privatizations. The strongest labor
confederation, the CGT, was divided into pro-privatization and anti-
privatization branches, leading to the formation of a completely new
labor union, which not only contested the privatizations but also chal-
lenged the undemocratic nature of the labor system. Privatizations led
to identical divisions and issues in the Turkish labor unions .
INSTITUTIONAL-LEVEL ANALYSIS OF PRIVATIZATIONS:

LABOR UNIONS IN ARGENTINA
I conducted two series of in-depth interviews with various Argentine
labor leaders active in different sectors and hierarchical levels in the
Argentine union structure and labor movement. The first series of in-
depth interviews took place in the summer of 2003 and the second
in autumn and winter 2006. A total of 31 in-depth interviews were
conducted.l" For purposes of reliability, I asked the same set of ques-
tions to the Argentine union repre sentatives as I did to the ir Turkish
counterparts. The questions were as follows:
~ How do you think privatizations have affected the structure of

the union movement, such as the divisions and groupings within
federations and unions?
~ How do you think privatizations have affected unions' relationship
with the state?
~ Have privatizations changed the way unions interact with the
private sector and the civil society?
~ Have privatizations changed the functioning of unions' internal
democracy in any way? If yes, how ?
~ What do you think is the relationship between privatizations and
democratization?
Unlike in Turkey, it was the initial stage of the privatizations that

incited mobilization on the part of the labor unions in Argentina.
It was later on that labor unions either acquiesced to privatizations
or contested them con sistenly. The main reason for this discrepancy
can be found in the highly partisan nature of Argentine labor: labor
unions created by Peron in the 1940s have been strong adherents of
Peronism and the party that claims to be its ideological adherent, the
PJ. Since it was the Radical government of Alfonsin that introduced
the project of privatizations for the first time and attempted to pre-
pare the legal ground for it, unions went, almost by instinct, against
the privatizations. Furthermore, Alfonsin's government had made
the strategic error of introducing a previous restructuring of the
Argentine union system with the 1983 Mucci Law." The 13 general
strikes staged against the government of Alfonsin were thus not pro -
testing privatizations as much as they were the government itself.
The shift in the Argentine labor unions' reactionary attitude as
soon as the Peronist Party's leader Menem came to power is a great
illustration of their partisan nature. Menem used his Peronist identity,
personal charisma, and elaborate patronage scheme involving labor and

business to ease the transition to a market economy. In this vein, he not
only transformed the statist nature of the Argentine economy but also
that of the Peronist party itself. Labor union leaders did not contest the
transformation of the economic model, nor did they oppose the change
in the identity of the Peronist party, as many among them received
substantial benefits for their support. The negotiations between the
Peronist government and the Peronist unions involved three kinds of
challenges and benefits directly related to privatizations: institutional
stability, and direct and indirect participation.
Institutional Stability
This referred to the survival instinct of the labor unions to main-
tain their institutional structure intact in the face of privatizations.
Prior to privatizations, there was one SOE in any given sector. With
privatizations, these huge state enterprises were broken down into dif-
ferent segments depending on the type ofsubsector and specialization,
except for the water sector where the private firm continued to operate
as one company. Accordingly, Gas del Estado was divided into ten big
firms in charge of the transportation and distribution of gas. SEGBA
was divided into seven private companies in charge of distribution and
generation. Each segment was then transferred to a different private
owner. In this restructuring of industrial relations and the state's role
in the economy, labor unions were also automatically reorganized: they
changed from being one union per one big state firm to a multitude of
unions per a number ofsmaller private firms. This reordering brought a
whole new array of questions and issues, inluding the decentralization
of union relations and the ensuing problem of "union framework"
(encuadramiento)16 (Gonzalez 1998,3).
Privatizations entailed a restructuring of industrial relations where
the players and incentives for collective agreement making underwent
substantial changes. Prior to the privatizations, collective agreement
making was centralized per sector (Novick and Catalano 1995). Since
there was one big state firm in each sector, collective agreements were
made in the headquarters of the SOEs . In this framework, the union
branches in the interior did not have much say in the decision making
as much as did the higher echelons of the union hierarchy, such as the
federation of unions or the national union (Tomada and Gonzalez
1998,4). As of2006, instead of one collective agreement for an entire
sector of activity, there were collective agreements per individiual
firms. This empowered the local union sections in a given geographical
region, and as such, decentralized the labor system in Argentina.
In addition to the decentralization of collective agreement mak-

ing and the empowerment of union representatives at regional
and local levels, privatizations have also been accompanied by the
outsourcing of different tasks to firms other than the privatized
companies. Many of these private firms performing tasks not directly
related to the core activity of the sector in scrutiny, such as cleaning
or security, were formed by none other than the former employ-
ees of the SOEs themselves. As such, these workers automatically
went from their previous collective agreement to being covered
under other sectors' collective agreements. This led unions active
in the main sector to vindicate the reincorporation of these workers
within the collective agreement regulating the main sector of activ-
ity. Workers also mobilized on various occasions to demand their
incorporation into the collective agreement of their choice, usually
the one providing them with better salaries and working conditions
(Tomada and Gonzalez 1998, 16).17 This is what is referred to as
the encuadramiento problem.
Direct Participation
Unions could participate in public offerings by buying assets in
privatized firms. The Labor Federation of Petroleum Unions of the
State (Federacion de Sindicatos Unidos Petroleros del Estado, SUPE),
for instance, bought several tankers during the privatizations and
formed a private company of its own in 1993, the Naviera Sur
Petrolera S. A. Fifty percent of the stocks of this new union firm were
distributed to the workers, while 50 percent stayed in the hands of the
union leadership and under its administration.l'' The Light and Power
Federation (Federacion de Luz y Fuerza, FATLyF), which includes
regional unions in its body, declared in 1997 that it was adopting a
twin strategy of mobilization and business unionism in the face of
the privatizations. FATLyF became the owner and manager of stocks
in various private firms active in the sectors of electricity generation,
transmission and distribution. FATLyF also managed the actions
owned by its members within the framework of the Program of
Participative Property (Programa de Propiedad Participada, PPP) .19
Finally, FATLyF acquired life insurance companies and hotels and
began managing private retirement accounts and work-related acci-
dent insurance programs. Hugo Giarelli, the secretary of funds and
finances ofFATLyF, corroborates the business attitude and mentality
adopted by the federation as a result of privatizations:
In FATLyF, we had had experience in managing complex systems of

industrial and labor relations prior to the privatizations. Privatizations
buttressed this tradition and enhanced our expertise whereby we could

now become more immediate owners and managers of firms and shares
in them. Of course, we have always acted with an eye to social philoso-
phy. The profits we make at the company grounds, we pass on to the
union grounds . We make sure the two realms are separate, and that the
interests associated with each do not get intermingled.
(Buenos Aires, July 2003)2°
Indirect Participation
The PPPs were part of almost every privatization program in
Argentina. They referred to prefixed percentages of shares transferred
to the workers of the privatized firms. With privatizations, unions
obtained the right to administer the PPPs for the workers. In San
Nicolas, the Union of Metallurgy Workers (Union Obrera Metal-
urgica, UOM) created an independent firm managed by a board
of experts to administer the PPP of its affiliates. Since the company
worked efficiently and workers had detailed instructions on when to
sell and how much to sell, the values of the stocks rose . This was the
opposite of what happened with the Telecom and Telefonica compa -
nies, where workers sold their stocks because the union administra-
tion followed the logic of aggressive selling to obtain quick cash. This
was the case more for Telefonica, where no worker shares were left,
than for Telecom, where 50 percent of the shares were still under the
control of FOETRA-BA at the time of this study in June 2006 .21
The three-fold strategies of institutional stability, direct and indi-

rect participation in privatizations have been intensively applied by
Argentine unions that, in one way or another, participated in and
benefited from privatizations. This does not mean, however, that all
unions cooperated with privatizations in Argentina, nor does it mean
that all cooperating unions did so in similar ways and degrees . The
three distinct union strategies crafted by the Argentine labor unions
toward privatizatons were "confrontation," "tough negotiation," and
"collaboration or soft negotiation." The first strategy was applied by
those unions active in SOEs and/or whose members belonged to the
ranks of the middle class. The number oflabor unions that confronted
privatizations steadily increased and spread to unions active in the
industrial and service sectors. The second strategy was adopted by a
small group of unions that initially confronted privatizations but then
switched sides to collaborate with the privatizing government. The
third strategy consisted of total support to the privatizing government
and its reform program (Palermo and Novaro 1996). It was this strat-
egy that was adopted by the majority of the Argentine labor unions .
Vicente Palermo and Marcos Novaro's (1996) tripartite typology

on union responses to privatizations is not the only categorization
in the literature on Latin America. Murillo (1997), for instance, also
created her own typology of labor union strategies under Menem's
administration. Accordingly, labor unions that were situated in the
CGT-Azopardo, and initially composed of more militant unions such
as the teachers', state employees', and metalworkers of Villa Con-
stitucion, were against Menem and his neoliberal program. Murillo
categorized these labor unions under the banner of "opposition
labor unions." The Movement of Argentine Workers (Movimiento
de los Trabajadores AI';gentinos, MTA) that later shifted to become an
implicit player in privatizations, was also categorized as a confronta-
tional union at the time of Murillo's writing.
Murillo characterized the second union strategy and attitude
toward privatizations as "loyalty." This strategy was adopted by the
Peronist unions in the CGT-San Martin and consisted of staying loyal
to the Peronist party, with the aim ofobtaining political appointments
within, and privileged relations with, the government in exchange
for their support of privatizations. The labor leaders, in this group,
were appointed by President Menem as the regulators of the welfare
funds or the so-called obras sociales. "Loyal labor unions" were
composed of one of the two state employees' unions, the Union
of the Civil Personnel of the Nation (Union del Personal Civil de la
Nacion, UPCN), the water provision workers, the telephone workers,
the meatpackers, the textile workers, the construction workers, the
chemical workers, the pasta industry workers, the lifeguards, the
railroad workers, and the state oil workers.
Finally, the unions that opted for the third strategy of "orga-
nizational autonomy" were large unions representing well-paid
workers who were active in the public or protected sectors . These
unions chose to remain independent in 1990 when the CGT split
to heavily invest and participate in privatizations to acquire busi-
nesses and engage in services and activities previously restricted to
their own members only. The Federation of United Unions of State
Oil Workers (Federacion de Sindicatos Unidos Petroleros del Estado,
SUPE), the Federation of Electricity Workers (Federacion Arqentina
de Trabajadores de Luz Y Fuerza, FATLyF), the Union of Railroad
Workers ( Union Eerroviaria, UF), and the Federation of Commerce
Employees (Federacion A1lJentina de Empleados de Comercio y
Servicios, FAECYS) were included in this third group of unions and
were characterized as "business unions." The tripartite division of the
Argentine labor union structure in the 1990s is shown in table 5.1.
ARGENTINE L A B O R IN THE GLOBAL ERA 143
Interviews carried out with labor union leaders in 20 03 and 2006

corroborated this triparti te division in the union struc ture, but also
showed signs of additional trends instigated more particularly by
privatizations . As one Argentine union leader put it, "Privatizations
is Menemism and Memenism is privatizations. There is no differ-
ence between these two phenomena, linguistically or conceptually"
(Basteiro 2006).22 The one significant difference found was that
the MTA, a dissident group within the CGT in the late 1990s, was
now a co-op ted subgroup, which could easily be situa ted somewhere
between the loyal and the business unions . Also important was the
emergence of a new and more radical anti-privatizations format ion,
the Class Conscious and Com bative Current (Corriente Clasista
y Combativa, CCC), denominated by some as an Argentine labor
confederation of and on its own. The transforma tions introduced by
privatizations in the Argenti ne labor union structure in the 2000s are
shown in table 5.2.
Table 5 .1 Classification of the Argentine labor union system in th e 1990s:

Neoliberalism as the ma in divide
Division CGT-AZOPARDO CGT-SAN MARTIN CGT-INDEPENDENTS

Position Opposition Labor Loyal Labor Business Labor
Unions Unions U nions
Strategy Confrontation To ugh Negotiation Soft Negotiation
Table 5 .2 Classification of the Argentine labor union system in the 2000s:

Privatizations as the main divide
MTA/
Traditional Gordos/
Division CTA CCC CGT Modern C GT
Position Explicit Violent Implicit Enthusiastic

Opponent Opponent Actor Participant
Main Defy privatizations Defy privatizations Survive in Thr ive with
Strategy legally and socially and privatizations privatizations
institut ionally ideologically
Culture Confrontation Picketing Pragmatic Business
Compromise Union ism
Main Tool Promoting Promoting Access to Access to
(Privatizations new forms of new forms of information/ financial
used as) institutionali zation participation Negotiation freedom
The CTA- The Pragmatic Opponent ofPrivatizations

Privatizations played a crucial role in the defection of a sizeable group
of unions from the CGT in 1991 . These unions subsequently formed
their own labor confederation, which not only contested privatizations
and globalization in general, but also the incumbent administration.
The Central of Argentine Workers (Central de los Trabajadores
A1lJentinos, CTA) originated in the Grupo de Burzaco-' formed
by the State Workers Association (Asociacion de los Trabajadores
del Estado, ATE), the Argentine Confederation Education Workers
(Confederacion de los Trabajadores de la educacion de la Republica
Arqentin«, CTERA) and the Union of Metallurgy Workers (Union
Obrera Metalu1lJica, UOM) in Villa Constitucion. Later on, unions
active in the private sector also joined the CTA.
Although the CTA was formed again st Menem's plan of reforming
the economy and the resulting unemployment, unions that joined the
Central justified their action based on their indignation with CGT's
pro-privatizations attitude . The three basic founding principles of
the CTA were declared to be (1) autonomy from the state, private
employers, and the political parties; (2) emphasis on union ethics; and
(3) democratization of labor and politics (Gonzalez 1996, 76) . One
of CTA legal counselors, Dr. Hector Garcia , said
With the privatization of the 80 percent of the SOEs, a new socioeco-

nomic environment emerged. Defined by unemployment and social
instability, and devoid of reinsertion mechanisms into the formal labor
markets, the new socioeconomic environment required a different type
of labor organization. The CTA was created to satisfy this need. The
CTA included the unemployed, fought against social instability and
proposed new mechanisms of reinsertion into the society. The CGT still
thinks that power lies in the number of affiliated workers, and now the
number of enterprises or hotels owned and managed. The CTA, on the
other hand, understands that the new source of sociopolitical power lies
in territorial organization and face-to-face contact. New societal strata
created by privatizations do not need a rigid and vertical structural
organization. A more flexible and horizontal organization is the answer
to the new demands of workers,includingthose employed in the formal
and informal sectors and those who are on the job market.
(Buenos Aires, August 2006 )
The CTA is a pluralist organization not only in its membership but also
in its ideology. Among its members are Social-Christians, Peronists,
Trotskysts, Commnists, Socialists, Radicals, and others. The composi-
tion ofthe leadership ofFOETRA-RA, the leading CTA-affiliated union
in the telecommunications sector in Buenos Aires, is a good example of

the pluralist membership and harmonious working of many ideological
tenets within the CTA.24 The secretary-general of the FOETRA-BA is a
Peronist, the associate secretary is a Social Democrat, and the secretary
of education is a member of the Workers' Pole (Polo Obrero), the leftist
mass-organization associated with the Workers' Party (Partido Obrero).
The CTA does not have any partisan links with political parties but
three main groups dominate within it: the "Front" composed of CTA
and Polo Obrero members, the "Block," composed of Moyanists and
the CGT supporters, and finally the "New Proposition," composed of
the more independent Social Democrats ."
The democratic nature of the CTA does not end in the plurality
and harmonious co-habitation of a variety of ideologies and affini-
ties within its body of leaders and members. The CTA also includes
organizations of retired workers, the unemployed, and prostitutes as
affiliate organizations and accepts individual membership . A worker
can thus be affiliated with a union that adheres to the CGT while
subscribing to the CTA as an individual for a symbolic fee of one
Argentine peso per month.i? The same is true for an unemployed
worker or a housewife . The CTA, as such, embodies the qualities of a
social organization rather than a traditional labor union.
In addition to individual membership and easy accessibility, elec-
tions for any given position within the CTA are direct and secret.
Members of the CTA choose their secretary-general as well as other
representatives together and directly. They do not, in other words,
select their worker representatives, who then choose the members
of the commission, which then selects the secretary-general, as is
the modus operandi in the CGT and its affiliated unions. Individual
membership and direct elections provide for a more inclusive and
transparent representation of workers, even though as with the CGT,
the same representatives are typically selected over and over again.F
Many Argentine academics, and the CGT leaders, define the
CTA as primarily an ideological movement and a rather insignificant
labor organization in practical terms. This study suggests otherwise.
Although the CTA started out as a conglomeration of public sector
workers belonging to the ATE and the CTERA only, it has extended
its affiliation to unions in almost all sectors of industry and services.
The CTA currently encompasses unions and federations active in the
railways, aviation, metallurgy, electricity, postal service, and com -
merce sectors . Thus, it would not be wrong to state that the CTA is a
smaller replica of the CGT, and operates extra-legally but as a parallel
labor confederation.
The CTA is a smaller-scale replica of the CGT because most of

labor federations that exist within the CGT are also present in the
CTA. The telecommunications sector federation in the CGT is
FOEESITRA and is replicated by the new formation of the Argentine
Federation of Telecommunications (FATEL) in the CTA. The energy
sector federation in the CGT, FATLyF, is replicated by the FETERA
in the CTA. The public sector employees union in the CGT is the
UPCN, and in the CTA, it is the ATE. The railway workers in the
CGT are organized within the pro-privatization UF, but a similar
organization accepting technical workers in the same sector exists in
the CTA. It is called the Association of the Management Personnel
of Argentine Railways (La Asociacion del Personal de Direccion de los
Ferrocarriles AJ;gentinos, APDFA) . The metallurgy sector workers are
divided between the CGT-affiliated UOM in San Nicolas and the
CTA-affiliated UOM in Villa Constitucion. The section of the UOM
in Quilmes is affiliated with the CGT but is very much akin to the
CTA in mentality and collaborative action .
The Federation of Workers and Employees of Postal and Telecom-
munications Sector (Federacion de Obreros y Empleados de Correos
y Telecomunicaciones, FOECYT) affiliated with the CGT also has
its counterpart in the CTA. It is the Argentine Postal Workers
(Trabajadores de Correo AJ;gentino, TCA) . The Industry and Indus-
try-Related Workers Federation (Federacion de los Trabajdores de la
Industria y Afines, FETIA) is the CTA equivalent of the Argentine
Federation ofCommercial and Service Industry Employees (Federacion
AJ;gentina de Empleados de Comercio y Servicios, FAECyS) in the CGT.
The counterpart of CGT's airline sector union Argentine Aviators'
Association (Asociacion de los Aeronauticos AJ;gentinos, AAA) in the
CTA is the Association of Aviation Personnel (Asociacion del Personel
Aeronautico, APA). Union federations and unions with personeriagre-
mial and active in the education and media sectors, such as those of
educators and journalists, are affiliated with the CTA and do not have
counterparts within the CGT. Table 5.3 shows these and other parallel
labor federations and unions within the CGT and the CTA.
The CTA is also a hub of research and analysis on questions of
direct and indirect impact on workers . The Institute for Training
and Research (Instituto de los Estudios y Formacion, IEF), a center
of research and development on sociopolitical and economic poli-
cies concerning labor, is set up by the CTA itself. The IEF organizes
conferences on issues of political participation, labor rights and
democratization. Many of IEF's affiliated institutions are formed
and established by unions under the aegis of the CTA. The Institute
ARGENTINE LABOR I N TH E GLOBAL ERA 147
Table 5.3 Sector-wide comp arison of labor federations and union s within the CGT
and the CTA
Sector/Labor Organization CGT CTA

Telecommunications FO EESITRA FATE L
Energy FATLyF FETE RA
Public Sector UP CN ATE
Railways UF APDFA
Metallurgy UOM-San Nicolas UOM-Villa Constituci6n
Postal Service FO ECyT TC A
Airlines AAA APA
Industry FETIA FAECyS
Education CTE RA
Journal ists UTPBA*
* Union of the Workers of Argentine Press ( Union de Trabajadores de Prensa de Buenos Aires,
UTPBA).
for Research on Participation and the State (Instituto de Estudio on

Estado y Participacion, IEEP), for instance, is formed by the ATE.
The Professional Institute for Study and Research (El Instituto
Profesional de Estudios e Investigacion, IPE!) is formed by the Center
of Telecommunication Professionals (Centro de Profesionales de
Empresas de Telecomunicaciones,Ce.P.E.Tel). Its objective is to make
this union an interlocutor equal to the private capital in political,
technical and legal questions in the telecommunications sector. The
IEF is also interested in issues of gender equality and equality of
opportunity in social, political and economic life. The publication and
research engine of the CTA called CTA's News Agency (La Agencia
de la CTA, ACTA) provides an efficient and accessible Internet site
for the study of these and other related que stions .r"
The lack of democracy in the Argentine labor union structure
has been one of the main complaints advanced by the CTA on both
nat ional and international grounds. Particularly, the CTA contested
the Argentine union law 23.551 for its undemocratic nature. The
CTA argued against the legal requirement of obtaining an official per-
mit, also referred to as the personaria gremial) from the Ministry of
Labor in order for a labor union to become legitimate and dispose of
th e legal rights of staging strikes, administering welfare fund s, drafting
collective agreements, et cetera.e? The contrast between th e CTA and
the CGT's views on the impacts of privatizations on labor relations is
apparent in the following juxtaposition of the input by th e two union
representatives from the same sector. Fernando Ledesma, the secre-
tary of organization of the CTA-affiliated Light and Power Union
148 D EMOCRATI C I N STI TUTIO N S
(Luz y Fuerza ) in Mar del Plata affirmed : "In the CGT, union repre-
sentatives are 'labor bureaucrats' (burocratas sindicales); in the CTA,
they are 'labor democrats' (democratas sindicales)."3o
The CCC-The Ideological Opponent of Privatizations

It might be argued that the CTA is a mere ideological organization
with no substantial say or impact in Argentina. In this view, the CTA
is conjured up as an overly leftist, and most likely, a temporary orga-
nization." Yet, this does not seem to be the reality in the Argentina
of 2006. Though rebellious, it is not the CTA, which is ideologically
driven in its formation and organizational principles. Instead, it is the
CCc. The CCC is characterized by its generally combative attitude,
its high capacity for mobilization and radical activism . As a much more
fluid and ideological movement than the CTA, the CCC was started
by the Revolutionary Communist Party (Partido Comunista Revolu-
cionario, PCRA) in 1994, even though its historical legacy goes back
to the resistance movement against the military dictatorship of the
1970s. The CCC was behind the social protests of "Ar,gentinazo" and
the associated demands for the construction of a popular government
in 2001. 32 Although its website defines the movement as mainly an
apolitical and sindical union with class-based ideas, the CCC of today
seem s to be anything but apolitical.
The three main branches of the CCC are composed of workers
that are currently employed and members of other unions, the unem-
ployed, and the retired workers.V Although there is a plurality of ide-
ologies ranging from Peronism to Radicalism and from Evangel ism to
Maoi sm, the main discourse is leftist . As the leader of the unemployed
CCC members, Juan Carlos Alderete, who became famous for his
organizing and leading the twenty days of picketing and camping out
on Route 3 in La Matanza during Argentinazo, said
I am a revolutionary. My lifelong dream was to go to Cuba and be a

guerrilla fighter. But myoid man, who was a traditional Peronist union
leader, did not want me to. When I was younger, I would read every-
thing I could find: Mao, Trotsky, Marx. I never made it as a worker
since I was always organizing my friends. Privatizations helped us forge
links with other revolutionary groups across the country and mobilize
together. Our goal is to organize and mobilize per neighborhood
(barrio) and continue to establish cooperatives for the unemployed
across the country. Cooperatives are especially important for the con-
struction of dwellings (viviendas). That is how we now have homes and
water, which we did not have before in La Matanza .
(La Matanza, Augu st 2006)
AR GENTINE LABOR IN THE GLOBAL ERA 149
Dario Perillo, member of the CCC and also a union representative

at the Unified Union of Education Workers of Buenos Aires affiliated
with the CTA (Sindicato Unificado de Trabajadores de La Educacion
de Buenos Aires, SUTEBA) stated
I am a Maoist . Our objective in the CCC is to establish alliances

with the popular forces of Argentina. Th at is the only way to break
Argentina's chains of international dependency... We are affiliated with
other national and international grassroots and labor organizations,
such as the Mo vement of Those Without Land (Movimiento de los Sin
Tierra , MST ), the Paraguayan Peasant Federation (Federacion Campe-
sina Paraguaya, FC P), the Bolivian Workers Front (Frente Boliviano de
Trabajadores; FBT), et cetera.
Although currently classified as the third largest labor confedera-

tion of Argcntina.v' the CCC is mostly a movement of piqueteros.
Juan Carlos Alderete said
We are the strongest and the most institutionalized movement of the

unemployed. Kirchner suggested that we become the union of the
unemployed but this would be like legalizing unemployment. Luis
d'Elia of FTV35 was co-opted by the government. Go and see his
people now. The y are left without a leader.
(La Matanza, June 2006 )
The Gordos (Fatsos)-The Enthusiastic Participant

in Privatizations
This group refers to the official CGT, which was directed by Rodolfo
Daer before the dissident subgroup MTA' s leader was elected as the
new secretar y-general in 2005 . It is composed of those unions most
powerful in terms of financial and political power and that chose to
stay independent when the CGT split in 1990 in line with pro- and
anti-Menem stands, including the que stion of privatizations. The
gordos are th e union leaders active in the sectors of services and
commerce, banking, insurance , healthcare, food, water, energy, et
cetera . The se unions have actively participated in privatizations and
have adopted the strategy of "business unionism" in dealing with
privatizations.
According to Jorge Gustavo Simeonoff, the executive secretar y for
the renegotiation and analysis of the public service contracts in the
Argentine Ministry of Economy, privatizations created small but pow-
erful unions led by the CGT's Gordos. He enumerates among others,
Jose Luis Lingieri (water), Jose Pedraza (railways), Oscar Lescano

(electricity), Julio Cesar Ieraci (electricity federation), and Juan
Manuel Palacios (motorized rail workers). These union patrons have
participated in privatizations and have obtained the right to manage
and own several firms in different sectors, providing goods and
services not only to their members, greatly reduced in numbers after
privatizations, but to the society at large. For them, privatizations do
not represent an ideological issue; they are just a matter of political
reality. As Pedraza, the secretary-general of the Railways Union said
"Privatizations are against labor mentality, everybody says. I was at
the table when Menem turned to everybody present and asked the
question of what else to do with the decaying SOEs, if not privatiza-
tions . Nobody came up with an alternative, so what other choice did
we have, really?"36
The MTA-Implicit Proponents of Privatizations

The MTA was a temporary formation within the official CGT,
which in contrast to the compromising stand adopted by the latter,
questioned privatizations and organized various protest movements in
collaboration and in cooperation with the overtly anti-privatizations
CTA. The financial power of the MTA came from the adherence of
rich and powerful unions like the UOM. As for its political power,
much of it originated from the charismatic attributes of its self-
proclaimed leader, Hugo Moyano, a former truck driver and the sec-
retary-general of the General Union of the Transportation Workers
(Union General de los Trabajadores del Transporte, UGTT).
The MTA was dissolved as soon as Moyano was chosen as the
secretary-general of the CGT. According to one Argentine analyst:
"Moyano put on some weight and became one of the cc,gordos)) as
soon as he was elected to lead the CGT. "37 The MTA was composed
of transportation unions, such as the truck drivers, urban transporta-
tion drivers, taxi drivers, but also the pharmacy workers . They were
all important and strong unions, and became even more so after out-
sourcing, included in privatization programmes, led to considerable
increases in the affiliates of these unions.V
The MTA constitutes the primary example of political unionism
because it radically changed its position from anti-privatization to pro-
privatization once its leaders were co-opted within the official CGT.
Upon joining the CGT, the MTA put an end to its explicit criticisms
of privatizations and neolibealism as a whole, and concentrated
instead on long-standing labor issues, such as wage increases and
working conditions.j? The selection of President Nestor Kirchner, his
government's renationalization of the water and postal service sectors,

the establishment of the new SOEs Energia Ar;gentina (ENARSA) and
The Federal Airlines, Inc. (Lineas Areas Federates Sociedad Anonima,
LAFSA) in 2004, the wage increases obtained in collective agree-
ments, and the re-regulation of the social security system in 2007 also
constituted good-enough accomplishments for the MTA leading it to
put an end to its focus on and fight against privatizations . Finally, and
more importantly, Moyano's own participation in privatizations clearly
and significantly helped in mitigating the polarization between anti-
and pro-privatization unions (Orsatti 2007).40
The MTA was not the only formation within the CGT-San Martin
that became an implicit actor of privatizations following Moyano's
new role as the secretary-general of the CGT. Several other unions
were political clients of Menem's government long before the MTA
joined their ranks. These were the public sector workers in the UPCN,
the water provision workers, telephone workers, meatpackers, textile
workers, construction workers, chemical workers, pasta industry
workers, lifeguards' unions, railroad workers, and state oil workers .
These unions provided critical support to the privatizations program,
mainly by staying loyal to Menem and pursuing their "strategy of
tough negotiations."
Among these unions, the UPCN is the archetype political union,
as it has followed the strategy of implicit support of privatizations.
Its leader, Andes Rodriguez, was very skillful in dealing with the
Menemist government. His negotiation skills were also coupled with
the logistical advantage that most of the UPCN member unions
were located in the provinces, therefore not as much affected by
privatizations as those unions of the capital Buenos Aires area. Dora
Orlansky (2001) maintained that privatizations actually increased the
number of employees in the political jurisdictions of the federal gov-
ernment and in the top cabinet positions. This gave the Pro-Menem
UPCN control over processes of employee recruitment, recategori-
zation, and promotion in the National System for the Civil Service
Profession (SINAPA), a promotion system established in 1991 for
the National Public Administration personnel and dedicated to the
organization of civil servants' administrative careers .
Although the institutional background of the UPCN did not
include any significant entrepreneurial management experience,
privatizations raised the need to create a new role for the union. The
UPCN chose to reorganize itself as an "Intermediary Management
Body (1MB)," that is, an "organization with the means necessary
to provide mediation for accompanying, monitoring and training
in undertakings and for self-employment." The union as an 1MB

had the "basic goal of triggering a dynamic process for the creation
of new enterprises through the recruitment of personnel with a
potential entrepreneurial profile" (Villaroel, 1999, 261-262) . Andres
Rodriguez, the leader of the UPCN, underscored the success record
of the union rather than its struggle with privatizations:
With privatizations, we have succeeded in obtaining shares in the form

of PPPs for our members . We also have maintained our union affilia-
tion and minimized as much as we could the effects of downsizing . We
continued and expanded our social security services. But then again,
privatizations affected us minimally compared to other sectors like
water, energy and telecommunications.
(Buenos Aires, July 2003)41
Other pro -Menem unions that followed similar strategies of "tough

negotiation" like the UPCN, corroborated Mr. Rodgriguez's words
regarding the ultimate goal of their unions as the minimization of
damages of privatizations. The pro-privatizations Telephone Unions
Federation (Federacion de Obreros, Especialistas y Empleados de los
Servicios e Industria de las Comunicaciones de la Republica Argentina,
FOEESITRA) which was divided and severely weakened by the disaf-
filiation of its capital Buenos Aires union, FOETRA-BA, was quick
to introduce a parallel labor union organization in capital Buenos
Aires, called the SOEESIT-Buenos Aires. Osvaldo Castelnuovo, the
secretary-general of FOEESITRA, said
At first, we tried to fight privatizations. But with a determined

government and a pro -privatization society, we were left alone in our
fight. We therefore chose to negotiate . We participated in the PPPs and
we now have a few hotels in different parts ofthe country as an alterna-
tive source of revenue. Our affiliates can go and spend their vacation
there for a very small fee.
(Buenos Aires, May 2006)

LEVEL OF INSTITUTIONS: PATHS AND CAVEATS
A general typology of the main Argentine labor confederations
according to their stands on privatizations should not be taken
to mean that the MTA and the traditional CGT, the Gordos and
the modern CGT, and the CTA and the CCC have been uniform
within themselves. On the contrary, an important consequence of
ARG ENTINE LABOR IN THE GLOBAL ERA 153
privatizations on union structure has been the more autonomous and

defiant stand adopted by a group of unions within the CGT itself.
Privatizations, in other words, have penetrated each confederation,
dividing them along pro- and anti-privatization lines. As a result, a
cluster of unions within the CGT has espoused clear and consistent
anti-privatization policies ala CTA. This is the case of the temporary
formation of the MTA.
The MTA was highly active in contesting privatizations and other
reforms and new trends spurred by globalization such as the labor
reform, reform of the social security system, high levels of unemploy-
ment, and the rising prices. It actively cooperated with the CTA and
the CCC-related picketer groups. The MTA also cooperated with
the rest of the CGT of which it continued to be a dissident , but still
an integral part. The unity and consistency in the actions and deeds
of the MTA centered on its being against Menem and his neoliberal
agenda while supporting the centralized Peronist labor system.
With the election of its leader, Hugo Moyano, as the secretary-
general of the CGT, the MTA was no longer active as of 2007.
Moyano and his movement seem to be co-opted into the official
CGT rhetoric and stand vis-a-vis privatizations. This is apparent in
Moyano's participation in the privatization of the Belgrano railways,
which the government is contemplating (Pedraza 2006 ).42 Other par-
ticipating actors in this project of privatization are Jose Pedraza, the
secretary-general of the Railways Union, and Canadian and Chinese
investors . While pro-privatizations in action, in rhetoric the MTA still
opposes the privatizations . Hugo Moyano's and the MTA's lawyer
and the current national deputy in the Argentine Parliament, Hector
Recalde, said
It is thanks to Moyano and his efforts that we have the postal service
and the water sectors back into the hands of the Argentine state, today.
Privatizations have negatively affected the social and labor relations
in Argentina. I am currently working on a project of law, which will
put limitations on the sectors in which private capital can invest above
a certain percentage. After all, there are limitations on labor's strike
activities. So, why shouldn't there be restrictions on capital's invest-
ment activities?
(Phone Interview. New York, February 2007)
While the MTA switched sides from an anti- to pro-privatizations

stand, the CTA and the CGT were more consistent in their positions.
The CGT was for and the CTA was against them . In addition, the
CTA, for the first time in Argentine labor history, expressed its explicit
support for political democratization in Argentina. A5 such, the CTA

became the "intellectual activist" of the Argentine labor movement.
The CGT, on the other hand, cooperated with the Peronist govern-
ments to support privatizations using a mix strategy of "political
clientelism" in the case of the unions with most of their members
located in the interior and less affected by privatizations, and a strat -
egy of "pragmatic negotiation" in the case of unions with most of
their members located in capital Buenos Aires and highly affected by
privatizations. The latter group of mildly Peronist, more autonomous
and financially better-off unions within the CGT used privatizations
to become entrepreneurs and to act as "business unions". The former
group of more Peronist and ideologically and financially dependent
unions enhanced their aptitude in political bargaining to become
intermediary bodies between the Peronist governments and the pri-
vate sector. Finally, the most recent formation of the CCC epitomized
the "institutionalized street activists," demanding basic goods and
services to the government of the day.
A5 in Turkey, in Argentina as well, there was collaboration between
unions and labor federations as a result of privatizations. Between 1991
and 1999 , the CGT, the CTA, the MTA, and the CCC joined forces to
bring about nine general strikes (Carrera 2006) . That said, cooperation
took place mostly at the interunion level than along confederational
lines in Argentina .. Unions affiliated with the pro-privatization CGT
collaborated with each other but not as much with those active within
the anti-privatizations CTA. When interconfederation cooperation
existed, it took place at the regional level between two or more local
branches of unions affiliated with separate labor confederations. For
instance, the CGT and the CTA-affiliated unions collaborated at the
regional level. The UOM-Villa Constitucion, affiliated with the CTA,
collaborated with the DOM-San Nicolas affiliated with the CGT,
which also cooperated with the CGT-affiliated DOM of Rosario on
various occasions, including for staging joint mobilizations.P
The best example of the cooperation effects spurred on by priva-
tizations within the CGT is the Argentine Confederation of Workers
of Privatized Firms (Confederacion Argentina de Trabajadores de
Empresas Privatizadas, CATEP) . The CATEP was formed in 2002
by the collaborative efforts of the Federation of Petroleum Sector
Workers (Federacion de Sindicatos Unidos Petroleros e Hidrocar-
buriferos), the Federation of Telecommunication Sector Workers
(Federacion de Obreros, Especialistas y Empleados de los Servicios e
Industrias de las Telecomunicaciones de la Republica At;gentina),
the Federation of Light and Power Workers (Federacion At;gentina
deTrabajadores de Luz y Fuerza), the Union of Light and Power

Workers (Sindicato de Luz y Fuerza de Capital Federal), unions
active in the railways sector (Sindicato La Fraternidad and Union
Ferroviaria) , the Federation of Gas Sector Workers (Federacion
de Trabajadores de la Industria del Gas Natural de la Republica
A'0entina), the Union of Water Sector Workers (Sindicato Gran
Buenos Aires de Obras Sanitarias), and the Federation of Postal and
Telecommunication Sector Workers (Federacion Obreros y Empleados
de Correosy Telecomunicaciones). CATEP's raison d'etre was to bring
the worker organizations together nationally and internationally so
that new projects of dealing with the privatizations and a globalizing
world could be created and implemented. CATEP's founders stated
four reasons for why privatizations required the active collaboration
of labor unions:
a) Preservation of jobs and maintaining of labor and union rights in

privatized enterprises;
b) Collaboration between consumer organizations and labor unions in
order to guarantee high quality goods and services offered by the
privatized firms;
c) Participation of union members in the design and implementation
of new products and management schemes in the privatized firms
through adequate union representation in them and the appropriate
training of workers; and,
d) Resolution of the Argentine labor unions active in the service
sectors to fully and effectively adapt to the new requirements of the
economic model in effect, and to ensure that economic growth is
accompanied with the necessary social policies and employment for
all Argentines.
(UNI2002)
Strong cooperation existed between the MTA and the CTA before
the former was co-opted into the pro-privatizations block. After
the virtual disappearance of the MTA, some cooperation took place
between the CCC and the CTA. Nevertheless, cooperation was minor
since the CCC rejected becoming part of the "illegitimate" capitalist
system, while, as of 2006, the more pragmatic and institutionalized
CTA was vying for personeria gremial to become an official actor in
this very system.
To summarize, interviews conducted with the Argentine union
leaders and an overview of the recent developments in the Argentine
labor movement show that the effects of privatizations on labor have
been manifold .
156 DEMO CRATIC INSTITUTIONS
Structural Fragmentation with Strategic Cooperation: Privatiza-

tions divided and enforced the existing divisions at the confederation
level. Privatizations also resulted in the differentiation of union strate-
gies in the political arena. The Peronist MTA block along with the
Menemist unions in the CGT adopted what can be called a "culture
of compromise" whereby they acted as implicit proponents of priva-
tizations. The left-leaning and pluralist CTA subscribed to a "culture
of confrontation," whereby it functioned as an explicit opponent of
privatizations. The more independent and financially richer unions in
the CGT espoused a "culture of business unionism," whereby they
became enthusiastic participants in privatizations. Finally, the CCC
became the institutionalized labor organization of workers who lost
their job and those who have never had one, engendering thereby
what can be called a "culture of street unionism."
Divisions also took place within unions and federations . The
CGT-affiliated postal service union, FOECYT, lost a group of
members, who subsequently formed the alternative federation, the
Federation of Argentine Postal Employees, FOECOP. The par-
ticipants of the FOECYT focus group in Cordoba pointed to the
proposed but never implemented PPP prograrnt? as the main culprit
of FOECYT's fragmentation and the subsequent formation of the
FOECOP. With privatizations, the Federation of Telecommunica-
tions Sector Workers (Federacion de Obreros y Empleados Telefonicos
de la Republica Argentina, FOETRA) was also divided. The union
in the city of Buenos Aires, FOETRA-BA, took an anti-privatiza-
tions stand as opposed to the unions from the rest of the country
that followed the pro-privatizations leadership of the federation,
FOETRA. As such , the FOETRA-BA recently disaffiliated from the
FOETRA.
Divisions within unions and federations spurred on by privatizations
did not always mean strife. On the contrary, different positions taken
vis-a-vis privatizations even produced harmony in some cases. Plurality
and collaboration within the CGT, the CTA, and the CCC were already
described . Furthermore, although interconfederation collaboration was
slim, some cooperation existed at the regional and local levels. The
structural organ ization of the union FOETRA-BA is good example of
such harmony amidst diversity. In FOETRA-BA, the union's secretary-
general, Osvaldo Iadarola, is close to Moyano in the CGT. The associ-
ate secretary, Claudio Marin, is an individual member and leader in the
CTA. Finally, the secretary of education, Silvia Hidalgo, is a member of
the leftist grassroots organization Polo Obrero.
Cooperation and cohabitation notwithstanding, privatizations

also triggered competition among unions. Privatizations brought
about interunion competition in terms of workers' affiliation, also
referred to as the problem of "union framework" or encuadr-
amiento . Journalist and labor specialist Santiago Senen Gonzalez
explained
Today, the strikes staged in the subway system are due to the encuadr-
amiento problem. The Transport Workers Union ( Union Tranviarios
Automotor, UTA) used to represent all workers employed at the sub-
way system prior to the privatizations. But after the privatizations,
all activities not directly related with the subways, such as security
or selling items, were outsourced to different firms. Outsourced
workers of the subway system want to become members of the
UTA again . Same problems dog the construction sector workers.
Those working in the petroleum sector would like to become mem-
bers of the petroleum sector union. Supermarket Carrefour's truck
drivers are members of the union active in the commercial sector.
Yet, they would like to switch to being members of Moyano's truck
drivers' union. They so desire because these unions offer better
salaries and their collective agreements guarantee better working
conditions.
(Buenos Aires, May 2006)
New Union Leadership and Governance Style: A cautiously more

autonomous leadership style and active unionism emerged with priva-
tizations, these changes coexisting with the old ways of conducting
labor politics. However, if one has to define the dominant leadership
style in each one of the three labor formations, it is possible to say
that the MTA and the traditional Menemist unions in the CGT chose
to "survive," and the modern and independent unions in the CGT
opted to "thrive" with privatizations, while the new and innovative
formations of the CTA and the CCC decided to "defy" privatizations.
Privatizations also contributed to the emergence of a more competi-
tive union leader at the local level. This will be analyzed in more detail
in the following section dealing with the personal accounts of workers
and worker representatives.
Demands for Democratization: More vociferous demands for

democracy and democratization have also been present in Argentina.
The CTA-affiliated unions have for the first time explicitly supported
political democratization in Argentina in the period starting with
the privatizations. In doing SO, they have each used their respective
perceptions of privatizations as one of the principal stimulating factors
for their new projects on democratization: the CTA's negative percep-
tion of privatizations as the main culprit of all woes, such as the rising
poverty and marginalization; the CGT's perception of privatizations
as a possible tool for better access to information and entrepreneurial
opportunities; the former MTA's view of privatizations as anti-Per-
onist; and the CCC's defiance of privatizations as a plot by the capi-
talist enemy have all entailed the cautious expansion of the Argentine
labor mentality outside the corporatist box. Although only the CTA
has advanced explicit demands for democratization, the CGT has also
adopted a smear of democratic rhetoric, which hitherto has seldom
been the case. The UPCN's secretary-general, Andres Rodriguez, for
instance, referred to its union's success in the 2005 collective agree-
ments as an achievement of democratization:
At a timeof profound changes, it was our union, the Union of Argentine
Civil State Employees, the UPCN, that conductedthe first collective bar-
gaining in the national public sector. This was not simply a trade union
claim, but a demand for a superior form of democracy in the workplace.
The people who make up the workforce do not act as mere individuals.
They do so collectively through social organization and participation.
Only if we get organized, can we prevail in the upcoming era; if we act
alone, however, we will fall pray to external forces."
The Cases of Renationalizations in Argentina: The renationalized

sectors of the water and postal services constitute areas of their own
both in terms of the attitude of the union representatives and their
members' stand vis-a-vis the privatizations. Union representatives in
these sectors all tend to be against privatizations based on pragmatic
and ideological reasons. The pragmatic justification they give is that
the private owners did not make the required investments. Their
ideological reasoning for being against privatizations, on the other
hand, is that privatizations are, by nature, antithetical to social wel-
fare and national sovereignty. Although idiosyncratic in many ways,
these union leaders act similarly to business union leaders in certain
respects . They refer to "their company," "their profit," "their invest-
ment strategies," and "their projects of expansion". Roberto Julio
Depetris, the advisor to the vice president of the now state-owned
po stal service company Correo Ojicial says, "With the renationaliza-
tion, the state and the union have reunited as partners in undertaking
the important task ofdevelopment and drawing up a common destiny
for the country."46
In sum, although this analysis has shown that the Argentine labor
structure has survived privatizations, privatizations have produced
considerable changes in the way institutions work within this struc-
ture. It is true that "single unionism" and "official recognition"
principles still persist. Yet, privatizations were instrumental in infusing
plurality to labor unions; federations were divided to include more
diversity in terms of ideological and professional composition and
services offered; collaboration, albeit limited, existed at the regional
and local levels; and finally, new formations came into being: the CTA
with direct elections, individual affiliation, and extensive involve-
ment in research constituted an important innovation distinct from
the traditional, corporatist, and monolithic world of labor a la CGT.
The CCC with direct democracy, neighborhood convocations, and
street protests, created the new social movement of the fluid unions
of the unemployed. Many traditional unions within the CGT became
business un ions, while others reinvented themselves as intermediate
organizations between the state and the private sector.
These developments show that the Peronist system of labor estab-
lished in the 1940s, though still powerful, is not intact by the end of
the first decade of the 2000s . That said, there is an important caveat for
the privatization-spurred forces to reshape the Argentine labor system
toward more democratic structures and institutions, and that is, the
much-yearned generational change within the ranks of the top union
leadership. As one Argentine government representative, Jorge Gustavo
Simeonoff, the executive secretary for the Renegotiation and Analysis of
the Public Service Contracts in the Ministry of Economy, put it
Privatizations have not changed the unions because union leaders still
sit at their secretary-general seats and have done so for decades . The y
and no one else have negotiated the privatizations . There is no genera-
tional change in the Argentine labor union system. Moreover, it is hard
to conceive such change since almost allgordos have male brethren who
will follow them in their footsteps .
(Buenos Aires, July 2006)
INDIVIDUAL- LEVEL ANALYSIS

OF PRIVATIZATIONS: ARGENTINE WORKERS
This study assumes that labor systems and institutions are more than
just what their leaders say or do . Labor unions are made up of thou-
sands of workers many of whom are active in their respective unions.
Although there are many studies examining the impact of privati-
zations on labor in Argentina, rarely do they encompass workers .
When they do, the scope of analysis stays confined to the sectoral with -
out undertaking systematic comparisons of Argentine workers in gen-
eral. To give some examples, Luis Beccaria and Aida Quintar (1995)
look at the socioeconomic consequences of the privatization of the
steel mill factory SOMISA in San Nicolas. Daniela Blanco and Carlos
Germano (2005) describe the conditions und er which the privatiza-
tions of radio and television channels took place in Argentina . Cecilia
Senen Gonzalez and Jorge Walter (1998) concentrate on the confron-
tation between those outsourced workers and others affiliated with the
core activity unions in the telecommunications sector.
Damian Pierbattisti (2005) is another labor scholar who takes a
sectoral approach on privatizations and their impact on internal union
democracy. He finds that the former state employees now employed
in the private company Telefonica are perceived as lazy, incompe-
tent, and rebellious, while the young professionals hired in the post-
privatizations period are deemed to be competitive, efficient, and loyal
to Telefonica. Pierbattisti links these differences to the privatizations,
which have made the employees of the privatized firm into potential
consumers , thereby promoting professionalism, individualism, and
competition. Such qualities, in turn, have been contrasted with the
characteristics associated, rightly or wrongly, with state ownership,
namely parochialism, solidarity, and employment for life.
Research Methodology and Findings

I conducted eight focus groups and several interviews with Argentine
workers in the spring of 2006 in Capital and Grand Buenos Aires and
the city of Cordoba. Thirty-four workers from the steel, telecom-
munications, energy, postal service, and transportation sectors were
involved in the focus groups (see table 5.4 .). The total number of
workers interviewed was ten, and included the additional sectors of
water and airlines. The workers were chosen nonrandomly based on
the sector affected by privatizations and the affiliation oflabor confed-
eration . Networking and waiting in front of the workplace or unions
to request workers to become participants in the study were the basic
mechanisms used in selecting the participants and forming the focus
groups. I directed the exact same questions to the Argentine partici-
pants as to their Turkish counterparts. The questions were as follows:
» What do you think of privatizations?

» How have privatizations affected your life in social, political, and
economic terms?
Table 5.4 Focus groups in Argentina, 2006
FG Place/Sector Participants Dominant Co nfederation Un ionismo Priv. Priv. PPPP

Ideology Affiliation Impact Percept.
San Nicolas 4 Pragmatic DOM High + + Same

>-
:tI
(Steel) Peronism CGT Cl
tTl
II Mar del Plata 3 Pragmatic LyF Low - - Same ..,Z

(Electricity) Left Fetera Z
-
CTA tTl
r'
III Co rdo ba 2 Pragmatic APJGas Low - - More active »
Ol
(Gas) None Fetera (not due to Priv.)
0
CTA High ++ ++ Same :tI
IV Buenos Aires 5 Left FOETRA-BA High None - Same Z

-..,
(Tclecomm.) Fatel
;I:
CTA tTl
V Buenos Aires 3 Pragmatic FOETRA-BA Low - None Neutral Same CJ
(Telecomm .) None CGT Medium r-
0
individual CTA Ol
»
VI Avellenada 6 Pragmatic AFDPA Low - More active r-
(Railways ) None CTA (not du e to Priv.) tTl
:tI
VII Cordoba Postal 5 Peronist FOECYT High None Same »
(Service) CGT
VIII La Plata Postal 6 Peronist FOE CYTCGT H igh None - Same
(Service) ......
Ol
......
Note: PPPP refers to post-privatization political participation.
> Have privatizations made you more active politically-leading

you to participate more than just by voting, such as engaging
in street protest movements, contacting your local and national
representatives, organizing or joining a social movement or a
local grassroots organization, et cetera?
Focus groups and interviews in Argentina showed that Argentine

workers do not portray a generally and consistently hostile attitude
toward privatizations when compared with their Turkish counter-
parts. Instead, workers affected negatively by privatizations tend to be
against them, while those that were positively affected by them tend
to justify and support privatizations. The rationalist vision of Argen-
tine workers is clearly seen in the juxtaposition of the focus group of
San Nicolas-Siderar Steel Mill factory (former SOMISA) with that
of Mar del Plata-Edea electricity distribution plant (former SEGBA) .
Privatizations led to wage increases, and opportunities for promotion,
education and training for three out of the four participants in the
first focus group. The three participants were pro-privatizations while
the fourth was less so . Privatizations led to temporary or permanent
unemployment in the second focus group, so the participants of thi s
group displayed clearly anti-privatization attitudes.
German, a former SOMISA employee, who was now working for the
contractual company Industrias Electricas Houston Inc. in San Nicolas,
and also a shop-floor representative in the same plant, said "As a gen-
eral rule, what belongs to everyone is in reality no one's." He argued
that only the three elements of what makes a nation, namely education,
security, and health, should be owned and regulated by the state . As for
the rest, the private sector could take charge . Etgardo, who was UOM's
secretary of communications, and a business administration student in a
regional Catholic University, went even further to affirm
Privatizations have invigorated the union structure and workers' men-

tality. We don't sit down comfortably in our chairs anymore. We need
to get out, educate ourselves, and learn how to interact with the
employer. With the PPP, we are now stock-owners, hence in the same
category as the employer. Now, we need to keep track of international
financial markets, stock prices, productivity and our rights as workers.
New union members and representatives of the rank-and-file are now
obliged to be more educated, more conciliatory and more ambi-
tious. There is no space for slackers or for libertinaje [doing as one
pleases]. With privatizations, we have now become labor activists with
a worker's soul and an employer's mind.
(San Nicolas, June 2006)
German's observations, followed by Etgardo's passionate com-

ments on the workings of the world of business, almost bothered
the third and relatively older participant, Alfredo, with a more tra-
ditional outlook on labor issues. Alfredo, like German, was a floor
representative, and has been so for the last 20 years of his life. He
was a Peronist, although he was neither from the Left nor from the
Right Peronist wings . Alfredo has constantly educated and enriched
himself intellectually, and his colleagues around the table agreed that
this was the reason why he was able to keep his union position after
the privatizations: "Alfredo reads a lot, and possesses the art of speech
and persuasion as well as invaluable experience in union affairs."
A fourth participant of the DaM focus group) Claudio, was grate-
ful to privatizations and to his union. He was grateful to privatizations
because they made his entrepreneurial initiative a possibility. He was
grateful to his union for the support it gave him in his initiative. Clau-
dio lost his job during the restructuring of so MISA in 1991. Then he
decided to take advantage of the opportunity to found a small business
of his own, through the microemprendimientos. He thus established a
cooperative of workers, Provser; which provides steel auto-scrubbing
services (autolavador) to the private firm SIDERAR. In the begin-
ning, SIDERAR lent Claudio and a few friends of his, four machines,
which in time, they were able to increase to fifty-three . Provser is now
advising the French company Polycon, which is a service provider in
Cordoba. Claudio's goal is to expand to South America taking advan-
tage of the free trade zones (zonas francas) in cooperation with the
international capital. Claudio characterized Provser as the third big-
gest and well-paying "firm" of San Nicolas, and not as a cooperative .
Meanwhile, he did not forget to express his gratitude to DaM for its
political and emotional support at every step of the way. He concluded
by repeating the pro-privatization workers' maxim:
I can be a boss now, but I have union mentality. This allows me to take
care of workers' problems in Provser without any difficulty. I was once
in their shoes so I understand them from the heart.
An interview, and a visit to the center of San Nicolas,"? with a for-

mer senior union member, Armando, attests to the power of DaM
and its prominent leader Nicolas Naldo Brunelli's role in Claudio's
success story. Armando asserts
Brunelli is more important than the government of San Nicolas itself.
He is our spokesman to Kirchner. Nothing gets done in Argentina
without the approvalof Kirchner nowadays. We cannot talk to Kircher,

but Brunelli can.
The second focus group involving current and former workers in

the electricity distribution sector's Union of Light and Power (Luz
y Fuerza) in Mar del Plata presented a completely opposite array of
experiences than in San Nicolas. Juan Jose, Roberto, and Juan were
downsized as result of the privatization of the state enterprise Eseva
after working an average of 15 years in it. Their fathers and uncles
also used to work in the same plant. After losing his job, Juan invested
his compensation money in a small grocery store . Most of the work-
ers went bankrupt following their brief adventure in investing their
compensation money in various small businesses of their own, such
as taxis, street kiosks, and grocery stores. Juan was lucky to keep
his business going. He was also helped by the fact that his wife had
a stable job. Juan was recently reincorporated into the private firm
following the hard work of the union and its resuscitated program
of Bolsa de Trabajo.48 He was now working as a night watchman at
the plant, but he was convinced that this was all good fortune . He,
furthermore, thought that he would have been better off were he
allowed to keep his job and progress without the interruption caused
by privatizations. He was against privatizations and despised them.
Both Juan Jose and Roberto were also against privatizations.
They likened privatizations to the HIV-virus because just like the
virus, privatizations spread fear and aversion among workers, none of
whom wanted to have the contagious disease . Juan Jose and Roberto
were both forced to accept the voluntary retirement packages (retiros
voluntaries), which they deemed anything but voluntary. They had to
have psychological counseling as a result of consecutive business fail-
ures and attempts to make it in their new lives as middle-aged, unem-
ployed men following the loss of their jobs after privatizations. Juan
Jose devoted himself to soccer. His friends thought at times that he
was half crazy since the episode of the privatizations. As for Roberto,
he even became a piquetero after various unsuccessful attempts at
selling homemade delicacies in the streets. Roberto said
My kids were just tired of eating the unsold pan dulce4 9 every night.
Nobody wanted to give me a job at 55 years old. They required me to
be 20, thin, blond and with blue eyes. But, I refuse to say that I am an
"unemployed" (desocupado) . In contrast, I am very much "employed"
(ocupado) . I take care (ocupo) of myself and my family. I repair
electricity, I paint, I clean... I do all these things to maintain myself.

Hence, I am an "ocupado" but with high blood pressure, diabetes and
vision problems. All these, thanks to privatizations.
(Mar del Plata, June 2006)
Obviously, Roberto and Juan Jose's interpretations of privatiza-

tions were quite different from those of the privatization winners
German or Claudio in San Nicolas. While the juxtaposition of the
pro-privatization UOM affiliates with that of anti-privatization Luz y
Fuerzay'Mar del Plata adherents clearly shows that Argentine workers
have instrumental rather than ideological views on privatizations,
it does not eliminate the alternate hypothesis that it was perhaps
the sectoral or regional differences that accounted for their diver-
gent assessment of privatizations.P" Another plausible explanation of
the self-interest based interpretation of privatizations by Argentine
workers can be found in the labor confederation with which different
first-degree unions are affiliated. Accordingly, the UOM members
may be pro-privatizations not because they benefited from them or
because they are employed in the steel sector, but because the labor
confederation CGT with which their union is affiliated supported
privatizations. By the same token, workers affiliated with the Luz y
Fuerza in Mar del Plata might be against privatizations because their
union seceded from the CGT in 1996 as result of the latter's support
of privatizations. Instead, it is now an active member of the alternate
but not officially recognized labor confederation, the CTA.
The third focus group conducted with three workers in the sector
of gas in Cordoba provides a good testing ground for the validity of
these alternate explanations of the impact ofprivatizations on individ-
ual workers . The Cordoba section of the Union of Gas seceded from
the CGT due to reasons unrelated to privatizations. Union of Gas
in Buenos Aires (APJGas), however, was still a member of the CGT,
even though its leader, Ruben Ruiz, was deemed to be getting closer
to the CTA in 2006. Finally, Cordoba is a region with a strong leftist
political history and the heart of worker movements. Therefore, the
alternative explanations of region and labor confederation affiliation
could adequately be tested with the case of this third focus group.
The two participants of this focus group of gas sector workers in
Cordoba also provided me with the tools for testing the alternative
hypothesis that it is the sector in which a worker works which deter-
mines his/her attitude about privatizations. This is so because Nelida
and Christian were both gas sector workers who kept their jobs as
a result of privatizations. Nelida, however, was highly critical of the
privatizations, while Christian was not. The reasons for the discrep -
ancy were surprising: Nelida saw her position downgraded as a result
of privatizations, while Christian was promoted to a position equiva-
lent of an engineer. Nelida thought privatizations did not create equal
opportunities for self-advancement of all employees, while Chris-
tian equated the whole idea and process of privatizations with the
enhancement of opportunities for professional self-improvement.
In another region and in a different sector, the contrasts between
Christian's and Nelida's attitudes vis-a-vis privatizations are directly
related to their perceptions of personal success or failure resulting
from privatizations. Christian likened the pre-privatizations period of
state ownership to an imperial era for the workers :
When my father was a worker of the SOE Gas del Estado, everything
was free. We would go on vacation every year to any part ofArgentina,
and it was free. Seeing the doctor was free. If the specialist we wanted
to see did not exist in Cordoba, we could travel free to Buenos Aires
just to see the doctor. But between the time I became a worker of
the state firm in 1985 until the time of the privatizations in 1992, I
witnessed the corrupt dealings of the public managers from very close.
Ministers would put their teenage daughters and sons as directors.
They would practically do their school homework at work, and get
paid . Toward the end of the state ownership, there was not even paper
or ink to print in the company. Privatizations meant a good cleaning
of the house . Those who did not work and did not want to work were
eliminated. Those who stayed had to prove to the private employers
that they were capable and willing to work .
(Cordoba, July 2006)
Nelida disagreed. She was the director of personnel at the time of

privatizations. She said
Privatizations came like a hurricane and put me even behind where

I had started when I first entered Gas del Estado. I am now a basic staff
member. I took some computer classes, but that is all. I learnt how to
use Excel, which I enjoy a lot. But getting a promotion is just impos-
sible. So, I have gotten involved in union activities a little more now.
In Turkey, workers placed rhernselves-! on the left-right politi-

cal spectrum, which was very important in determining their
social and political activity regarding privatizations as well as their
understanding of them. In Argentina, on the other hand, work-
ers were much more self-centered, materialistic, and instrumental
in their assessment of privatizations when compared with their

Turkish counterparts. While this does not mean that the Argentine
workers were apolitical, it means that ideologies and partisanship
were less apparent in Argentina than in Turkey, except for Argentine
workers with leftist ideologies who still used political and ideologi-
cal reasoning in their rhetoric when analyzing and describing the
privatizations.
A comparative analysis of the four focus groups conducted
with workers from the telecommunications sector provides a good
illustration of the impact of political ideologies in molding the attitude
and behavior of Argentine workers vis-a-vis privatizations. The focus
group I conducted with six workers, who were active members of the
anti-privatizations FOETRA-Buenos Aires, showed that Marxism,
Trotskyism, and other variants of the leftist ideology made workers
into strong opponents of privatizations. If anything, Omar said, priva-
tizations pushed him and his friends to read more about capitalism
as an ideology and a system of organizing the polity. At the end, he
became convinced that capitalism was the enemy. Even though his
father was a Peronist and a prominent union leader affiliated with the
CGT, privatizations confirmed that he was right not to have walked in
his father's footsteps.
Like Omar, the other five participants of this focus group, were all
active union members and floor representatives with leftist ideologies.
None of them had lost a job as result of privatizations even though
the restructuring of the telecommunications sector had decimated this
sector's employees from 24,000 to 12,000 approximately. They had
all endured "psychological torture" by the private employers so that
they would accept the large sums of voluntary retirement packages
(retiro voluntario), and leave. Since they were floor representatives in
the pre-privatizations period, they were deemed to be dangerous in
the eyes of the "capitalists." They were offered twice the normal rate
of compensation to make it more attractive for them to leave. Were
they not to accept the money, they were left without any work to do .
Sometimes, they could go on idle for months. Their family members,
especially their wives, were contacted by the private firm in order to
make them convince their husbands that retiro voluntario was in their
families' best interest. Omar said
I resisted these capitalist tactics. I took it day by day and I am still a

floor representativetoday. I plan to stayas such for the rest of my days.
Being a worker is my passion.
(BuenosAires, July 2006)
The FOETRA-BA/CTA focus group provides a good contrast with

the results of an interview conducted with a floor representative affili-
ated with its Menemist counterpart, the SOEES1T/CGT. Jorge was
an active member in this Peronist labor union in the telecommunica-
tions sector. 52 Jorge lamented that the state did not support them in
their initial fight against privatizations, which brought him and his
friends affiliated with the former FOETRA, now SOEESIT, to switch
to the negotiation mode for the sake of workers . He was now grateful
that he did not accept the retiro voluntario because when he sold the
stocks that he had obtained as part of the PPP during the privatiza-
tions, he obtained much more than he would have gotten with the
retiro voluntario. Jorge said, "I am equally grateful to EnTel (SOE) as
I am to Telefonica (private company). Everything that I and my family
have today is thanks to them." Jorge's attitude was typical of members
of unions that cooperated with the privatizations in other sectors.
The comparison of FOETRA-BA/CTA with SOEESIT/CGT
workers' accounts showed that workers with leftist ideologies were
much more likely than their Peronist counterparts to justify their
stand toward privatizations in ideological terms, regardless of their
sector, age, or education level. In other words, the impact of materi-
alistic and individual explanations were much less obvious in the case
of workers who described themselves as leftists than in workers who
described themselves as Peronists. Peronist workers typically used the
argument that privatizations were going to come one way or another
and that there was nothing they could do about it. As Carlos, who
was a Peronist floor representative affiliated with FOETRA-BA, and
currently working at Telecom, said "Privatizations proved to be good
because with the state enterprise, each government change would
mean a change in the managers ."53
The caveat for both groups of workers, however, was that they be
active members in their unions. Leftist workers were more ideologi-
cal and Peronist workers were more rationalistic about privatizations,
only if they were unionists, that is, active members of their respective
unions. But, what about those workers who were not active members
in their unions or who were not members of any union at all? What
was their attitude toward privatizations?
The focus group, involving three relatively less active members
of FOETRA-Buenos Aires, who also were individual members of
the CTA, indicated the relative weakness of ideology in forging
attitudes toward privatizations. For Cesar, Ezequiel, and Gustavo,
privatizations had to be done, and they improved technology,
infrastructure, and ultimately, life in terms of access to goods and
services. They, thus, agreed with privatizations in general terms . They

disagreed, however, on the ways in which they were carried out. They
cited the lack of transparency, dearth of adequate regulation, and the
high degree of unemployment as downsides of privatizations.
In this group of nonactive members of the left-leaning CTA,
only Gustavo was an ex-En'Iel worker, while Ezequiel and Cesar
had joined the firm after the privatizations. All of them, however,
used very analytical, pragmatic, and rational criteria when assessing
the pros and cons of privatizations. The same is valid for Fernanda,
who was interviewed on a separate occasion . Fernanda was only nine
years old when EnTei was privatized in 1991. She thought that apart
from the problems of unemployment and marginalization, privatiza-
tions provided many opportunities for Argentina. Fernanda was not
a member of any union. She thought overall that the "union people
were overly ideological, too much on the left, and too confrontational
for her taste" (Buenos Aires, July 2006).
Another lively example of the lack of significance of variables of
partisanship and ideology as determinants of Argentine workers' atti-
tudes toward privatizations comes from the focus group conducted
with workers in the railway sector in the suburbs of Buenos Aires.
Olarte and his five friends never became union members during the
state administration, nor did they do so after the privatizations. They
recently mobilized, however, to become union members for the first
time. What prompted them to suddenly want to unionize and be
active in the labor movement was their finding that the private owners
cared much more about the unionized workers than they did about
the nonunionized workers . Olarte of Ferrocarril Roca said
When the privatizations came in 1993, we thought we would be the

owners of the company because we were not union members and we
were hierarchically higher in the scale of skills. We thought the private
owners would like that and consider us as their equal. On the contrary,
year after year, we saw that the workers covered by the collective agree-
ments of their respective unions got raises and worked under better
conditions, while we were consistently left out. As supervisors, the
workers we supervised started earning more than us. They then started
disrespecting us. We, therefore, decided to join the union of railroad
technicians and supervisors in 2005 simply because we were betrayed
by Charlie (a.k.a. Carlos Menem) and the private employers.
(Avellenada, May 2006)
A contrary case to the argument of the relative weakness of ideology

in forging Argentine workers' attitudes (except for left-leaning workers)
toward privatizations came from the focus group I conducted with

postal workers in Cordoba in the section affiliated with the FOECYT.
This focus group showed that Peronist workers, who were active in
their union and who were not affected negatively by privatizations,
were actually against privatizations for partly ideological reasons .
The postal workers of Cordoba were proud of all the mobiliza-
tion activities they had engaged in to prevent privatizations. They
had staged many strikes and protest marches during which union
leaders were injured in their several encounters with the police. The
postal service union section in Cordoba was also engaged in creative
protest movements against the private owner Macri. Very much like
Petrol-Is affiliated with the pro-privatizations TURK-IS in Turkey,
the Cordoba branch of FOECYT used creative slogans, posters, and
other means of the written media to inform the public about the cor-
rupt dealings of the private owners. One of them showed Mr. Macri
dancing with a woman and read "This is how Macri spends the perks
of privatizations."
The argument of the newly selected secretary-general of the local
union section, Jose Miguel Del Giudice, was interesting:
Macri is not an Argentine but an Italian firm in essence. Its basis is in

Italy, and has taken all the profit abroad . This is similar to the rest of
the foreign firms that have participated in privatizations.
Why were postal union workers of this part ofArgentina ideological

even though they were not negatively affected by the privatizations?
Why did they not use an interest-based explanation to privatizations like
the rest of the active union members who were pro-privatizations?
Cordoba is a part of Argentina known for its social democratic
and leftist political legacy. The famous working-class protest of
1969, Cordobazo, happened there . This could have been a plausible
explanation for understanding the deviant reactions and attitudes
of the postal sector workers in Cordoba, had it not been for the
findings of the gas sector focus group also run in the same city.
However, the experiences of the gas sector workers in Cordoba has
shown that the legacy of the city and the location by themselves
did not have any significant impact on workers' reactions to priva-
tizations since reactions of the gas sector workers in Cordoba were
equally rationally driven and self-centered as were the reactions of
workers in other sectors in Buenos Aires. There had to be, therefore,
a third factor, in addition to, and apart from, ideological/rational
and national/regional divides influencing workers' attitude toward

privatizations. The focus group I conducted with the po stal workers
in La Plata provided clues to this puzzle.
The seven workers of different age groups and with different
levels of education, some of them active, others less so in the union
of postal workers in La Plata, the capital of the province of Buenos
Aires, showed the prevalence of emotional and ideological arguments
in workers' negative assessment of privatizations despite their not
being negatively affected by them. The participants, in this focus
group, concurred
Privatizations went against the Argentine core tradition of drinking

mate.54 Private owners divided postmasters across different regions so
that they could not take breaks and drink mate together.
(La Plata, July 2006)
Why did not these postal workers of La Plata, who were not
negatively affected by privatizations, assessed them in ideological and
negative terms? The explanatory factor might have come from one
common point that they shared with the postal workers in Cordoba:
the postal sector was recently renationalized, following a brief period
of private ownership by the group of Macri between 1997 and
2004. We can thus safely affirm that the attitude of the postal sector
workers vis-a-vis the privatizations were distinct.. It was not the left-
ist/Peronist ideology or the rational-individual reasoning that drove
their understanding of privatizations. Nor was it the regional legacies
per se. It was instead their unique identity as workers of a company
owned by the state that determined their understanding and percep-
tions of privatizations. This is apparent in some of their following
statements (La Plata, June 2006):
During the era of the private firm, union was not listened to. Now,
there's hope that they listen to us... because now, we are the State.
We could not fight against privatizations effectively because the state
was not with us at the time. Without the state, unions cannot do much.
Now that we are the state again, there is no more fear. It is much easier
to foment and maintain solidarity.
It is easier for us, the workers, to speak with a politician than with a
businessman. For a politician, one worker means one and even several
votes, including those of his family and friends. A politician must
protect and cater to us. For a private employer, however, we represent
mere numbers in registration records. This makesthe private employer
arbitrary, authoritarian and inflexible toward workers.
172 DEMOCRATIC I N STITUTIONS
Such statements coming from postal workers in La Plata were

echoed in the following statements of their Cordobose counterparts
(Cordoba, July 2006) :
In the state administration, as opposed to private ownership, the state

delegates management to workers. Many union leaders become the
actual managers along with, and in addition to, more direct political
appointees of the government. Carlos Rossi of FOECOP is one such
union leader who now is the vice president of the Company.
We finally have the guarantee and stability of work under state
administration as well as opportunities for advancement in the
management of the firm. Now, it is the era for new politics and a
new mentality. The postal service is the honor of a country and it is
a social service. People have a basic right to information and com-
munication. Private firms only invested in areas where they expected
profits.
The uniqueness of the attitude of the renationalized postal service

sector verifies the impact that privatizations have on workers' attitudes
toward them . In fact, to better understand the impact of privatiza-
tions on the changing attitude and behavior of workers, one must not
look into the effects of privatizations only, but also the consequences
of the opposite of privatizations, that is, nationalizations. As seen in
the cases of the postal service workers in La Plata and Cordoba, it
does not take long for workers to go back to state-dependent and
patron-client language of the state ownership era .
The same rhetoric of symbiosis was also easily detectable in the
former private sector employee and current union employee in the
water sector that was undergoing renationalization at the time of
study in 2006. Maria Del Carmen Framil, the coordinator of the
training program "Technological Institute of Leopoldo Marechal"
of the Union of Sanitary Workers of Grand Buenos Aires (Sindicato
G.B.A de Trabajadores de Obras Sanitarias) emphasized that (1) the
water sector was not privatized but given out as a concession, and
that the two were distinct phenomena since ownership stayed in the
hands of the state in the latter, and that (2) there was no room to defy
privatizations but only to sur vive them using innovative and intel-
ligent strategies, among which training occupies a central role. Now
that the water sector was in the process of being returned to state
ownership, the union itself was undergoing a structural reorganiza-
tion acquiring an increas ing degree of importance and power in the
management of the firm .
The sui generis stand of renationalized unions notwithstanding,

one important finding of this research on the changing attitude and
behavior of Argentine workers as result of privatizations is that none
of the focus groups under scrutiny has shown that privatizations ren-
der Argentine workers more active politically. On the contrary, the
consistent finding of the focus groups has been that privatizations
did not change workers' level of political activity. Instead, workers
who had a union consciousness before, and who were active union
members prior to privatizations, continued to be so after. Privatiza-
tions played the role of a catalyst at best, making such workers more
active temporarily and pushing them to change their strategies in
accordance with the changed conditions.
As for those workers, who were merely registered members of
unions without necessarily having union consciousness, that is, not
active union members, they continued to be inactive, looking for
alternative means of survival in the aftermath of the privatizations,
as did the deunionized workers. The only exception to the lack of
increased political activity as a result of privatizations in Argentina
came from the focus group I conducted with the founders of the
Oro Negro (ON) social movement. This was a protest movement
against privatizations and was started by a group of nonunionist and
downsized workers of the state petroleum firm YPF. The peculiarity
of the movement was that it was formed in 2001, eight years after
the actual privatization of this sector. The leader of the movement,
Ana Maria, explained
Every time we gathered with friends after our sad departure from the
YPF family, I witnessed nothing but complaints about the injustice of
privatizations and of the vicious scheme of'retiro voluntario" , Many
of us were downsized before the privatizations. Therefore, we were
not offered the PPP stock options, as were thousands of workers
downsized after the privatizations. As such, there were many injustices
that needed to be brought into light. Together with my husband and
a couple of friends, we obtained copies of electoral lists and went to
the polls to meet the victims of the YPF privatization. We henceforth
started our legal fight against privatizations: we had a project of law
passed in the Senate, which decreased the age requirement for retire-
ment eligibility. Those who were 50 years old and/or those who have
worked for 25 years could now retire. We also succeededin getting law
25.471 passed: this law prevents the seizure of goods of those former
YPF workers who default on their debts. Our legal fight found a great
institutional niche in the eTA .
(Buenos Aires, August 2006)
174 DEMOCRATI C INSTITUTIONS
In contrast to the Turkish protest movement of the OM , which

came into being as soon as the first mass firings took place after the
privatization of the same sector, that is, petroleum, it took years
for ON to come into existence. Once it did, the adherents of the
movement fought not only for the recuperation of their jobs but
also for the renationalization of the energy sector as a whole . Ana
Maria said "The water and postal service have been renationalized.
There is a proposal to renationalize the railways sector. Why not the
oil secto r also?"
If the OM in Turkey was a spontaneous and loose movement of
practical needs and aims, the ON in Argentina was one of careful
and long planning with the associated political and ideological goals
and premises . The main ideological template of the movement came
from General Enrique Mosconi, who had directed the state-owned
YPF from 1922 onward. Ana Maria said that their objective was to
spread the Mosconian ideals of state ownership of natural resources.
Each year, along with its partner NGOs, that is, the Movement for
the Recuperation of National Energy (Movimiento por la recuperacion
de la enet;gia nacional, MORENO), the Federation of the Workers
of the Energy Sector of the Republic of Argentina (Federacion de los
trabajadores de enerqi« de la Republica At;gentina, FETERA), and
the National Commission for the Commemoration of the Hundredth
Anniversary of the Discovery of Petroleum in Argentina (La Comision
Nacional para la Conmemoracion del Centenario del Descubrimiento
del Petroleo At;gentino) CoCePA), the ON paid homage to General
Mosconi by visiting his tomb at the famous Recoleta Cemetery in
capital Buenos Aires.
The account of the ON and its ideological objectives notwith-
standing, one can conclude that it was not as much the impact of
political and ideological groundings that determined Argentine
workers' experiences with privatizations, as much as their rational
and individual assessments of their gains and losses as a result of
privatizations . Except for the active union members with leftist
ideologies and active union members in renationalized sectors,
Argentine workers supported, or at least, did not contest privatiza-
tions, if the latter made them richer. Argentine workers took an anti -
privatizations stand, if privatizations made them poorer. Generally,
active union members, regardless of their individual or their unions'
political affiliations, were better off as a result of privatizations, com -
pared to those workers who either were not union members or those
who were, but merely on paper. This refers to the critical variable
I call "unionismo ."
ARG ENTINE L ABOR I N THE GLOBAL ER A 175
U nionismo can be defined as the consciousness of being active

union members, regardless of ideol ogical groundings. Workers with
leftist, rightist, centrist, or other ideological groundings can eith er be
unionist or nonunionist. Those who are un ionists are active union
members; those who are not, are either only registered members of
un ions with no active participation in th em or are not un ioni zed at all.
In Argentina, unionist workers survived privatizations because the y
were protected thanks to their positions within the uni on s or becau se
they were backed by them. In the case of unions that support ed
privatizations, unionist workers fared even better becau se the y could
increase their wealth and status using privatizations. In th e case of
union s that contested privatizations, unionist workers kept their
union positions and continued the ir activism toward the protection of
work er rights, this time against privatizations. Nonunionist workers
did not fare as well. They did not have the protection of established
union organizations. As a matter of fact, the Avellenada focus group
showed that even those workers who were not downsized as result of
privatizations needed union protection and coverage to feel secur e in
the po st-privatizations period.
Overall, my study showed th at the Argentine workers have
responded to privatizations using three kinds ofstrategies: individual)
O1;ganizational-entrepreneurial) and collective.
Individual Solutions for N on unionist Workers

Uni on s in Argentina are still very powerful entities, politically, insti-
tuti on ally and socially. This is so becau se all the nonunionist wo rkers
justified their lack of social or political action after privatization s based
on the grounds that th ey did not have the necessary support of a
union . For the Argentine rank and file, any social movement devoid
of union support or leadership was unthinkable. The case of Carlos,
an ex-Aerolineas worker, is telling: "Unions supported privatizations,
but they did what the y had to do and what they could do. That's
all." Carlos was now the doorman in the CTA-Capital Buenos Aires
because he was a good friend of the secretary-general of the same
institution. Like Carlos, many victims of privatizations used their
friend and family connections to survive in the post-privatizations
period. The ex-YPF worker, Roberto, worked as a clerk in the union-
managed Social Security for the Employees of Commerce and Com-
merce -Related Industries ( Obra Social de los Empleados de Comercio
y Actividades Afines, OSE CAC) in La Plata because his wife was the
best friend of the secretary-general' s wife. Sara, an ex-railways ticket
clerk, became a nurse and home-care provider. She never envisaged
going to the union to ask for any kind of help or to join a protest
movement for that matter. Sara said
I have never really liked unions . They are the reason why I lost my
job . They are corrupt. Pedraza [the secretary-general of the Railways
Union] is now a millionaire thank s to no other than privatizations.
Friends and family connections were not the only solutions that the
nonunionist Argentine workers resorted to in the post-privatizations
period. The nonunionist workers chose different individual solutions
to survive in the post-privatizations period . Younger workers, particu-
larly those with a minimum of skills, went abroad, mostly to Spain.
Both of Roberto and Juan 's sons, from Luz y Fuerza in Mar del
Plata, were in Spain doing manual work at the time of my interviews
with them in 2006 . The elderly, who were already retired or close to
retirement, went to the interior of the country. The father of the suc-
cessful gas sector worker in Cordoba, for instance, was downsized as
result of privatizations . He bought three homes in the interior of the
country with his generous compensation package and was successfully
renting them to tourists. The middle aged mostly engaged in entre-
preneurial activities, such as buying and managing taxis, kiosks, and
small grocery stores . Most of them went bankrupt since there was too
much supply and not enough demand. These failures brought many
problems, including an increased rate of alcoholism, drugs, divorce,
crime, and in some cases, suicide (Chervo 2003).
Those with higher education and/or additional skills simply con-
tinued their lives converting their hobbies into a profession . Juan
Carlos, an ex-En'Tel worker, learned French and continued to run
his deceased father 's plastic workshop. Guillermo, also an ex-En'Tel
professional with a Masters degree from the London School of Eco-
nomics, began teaching in FOETRA-BA. Ana Maria's husband made
his hobby into his main job as an iron-maker. This does not mean,
of course, that they were entirely happy with how things turned out.
Juan Carlos missed wearing a tie every day and working in front of a
computer. He said he did not feel like he belonged in the society any-
more . Even to get a loan, he needed his friends to sign as guarantors
for him, and he felt shame when he gave out his wife's business card
when he introduced himself. Guillermo liked the slow pace and lack
of stress in his new life as an educator but complained that he was not
earning as much as he used to . Ana Maria's husband spent his extra
time in the ON -related activities.
ARG EN TINE LABOR IN THE GLOBAL ERA 177
01';ganizational-Entrepreneurial Solutions for Unionist Workers

Workers who were active in their respective unions, either in top
positions or as floor representatives, were usually protected against
the negative impact of privatizations. The y kept their jobs and their
posit ions in the union. This was the case for both the leftist members
of the CTA, which contested privatizations, and the Peronist mem-
bers of CGT-affiliated unions, which supported and participated in
privatizations. Relatively younger, more ambitious, and less ideologi-
cal unionists actually used privatizations to engage in entrepreneurial
activities with the political and organizational support of their unions,
as was the case with th e UOM affiliates in San Nicolas and the success-
ful gas sector worker in Cordoba. Many of them acquired education
and training in as diverse areas as psychology, busine ss admini stration,
human resources and sociology.
Collective Solutions for R e-Un ionized Workers

It would be safe to say that in Argentina, privatizations did not
produce any large-scale social movement or organization on the part
of affected workers . Individual solutions for those outside the union
framework and union-related solutions for those inside dominated.
The only minor exception to this trend was the ON . However,
the case of ON cannot be cited as a pure example of a mass-based
social movement formed as a result of privatizations. A juxtaposition
of the Argentine ON with its Turkish counterpart, the OM, makes
this clear.
The OM movement in Turkey was formed as a direct result of, and
immediatel y after, the privatization ofthe SOEs in the petroleum sector.
The first and foremo st goal of the movement was the securing of jobs.
Renationalization was never part of the picture in the OM experience
and project. Once jobs were obtained, the movement withered away.
Nor did the movement draw on any specific historical figure to justify
its raison d'etre . Finally, the OM movement was a loose grouping of
regional self-elected victims of privatizations , who mobilized their
friends to engage in protest marches and dialogue with the government
representatives . As such, the OM did not benefit from the institutional
and organizational infrastructure that the CTA has provided to the ON
movement in Argentina.
In contrast to the OM in Turkey, th e ON in Argentina was
formed years after the actual privatization of the petroleum sector.
Its objectives included the political and ideological proje ct of
renationalizing the energy sector. Furthermore, soon after it was
established, the movement joined the unofficial labor confederation
of Argentina, the CTA, and was still an active member of this institu-
tion in 2006. ON, therefore, reinvented itself as part of the union
movement in Argentina as soon as it was born in 2001. One cannot
help but wonder if the ON would have endured had it not been for
the institutional framework and support provided by the CTA.

LEVEL OF INDIVIDUALS: PATHS AND CAVEATS
To recapitulate, the three main findings of the focus groups con -
ducted in Argentina are that (1) the main determinant of workers'
reactions to privatizations was unionismo, that is, the degree of affilia-
tion with unions, (2) Argentine workers tend to be instrumental and
individualist in their assessment of privatizations and their attitude
toward them, and finally, (3) privatizations did not render Argentine
workers more active politically or socially, and no immediate social
movement coming from the collective efforts of the rank and file was
formed as a way to question or protest privatizations.
Regarding the first finding on the main determinant of worker
reactions to privatizations, one cannot help but wonder whether
history has been at play here . This is to say that in Turkey workers'
reactions toward privatizations were mainly determined by partisan-
ship, that is, individual standings on the left-right political spectrum
and loyalty to a given political party. In Argentina, partisanship or
political ideology, except for leftist ideologies, were not significant
in determining the level of political activity in the post-privatizations
period or the attitude toward privatizations in general. Unionismo
was. Accordingly, active union members regardless of their geo-
graphical milieu, sector of activity, hierarchical level in the union,
educational level or age, continued to be active after privatizations,
while nonunion members looked for individual solutions, and did not
necessarily increase their political participation after being negatively
affected by privatizations.
This brought the second divergence at the individual level of
analysis between the Argentine and Turkish workers. Argentine
workers' attitude toward privatizations was driven by an instrumental
cost-benefit analysis except for the nonleftist and the nonstate work-
ers. Argentine unionists were sheltered from privatizations because
they had an official position within their unions. The floor represen-
tatives, for example, were sheltered by their respective unions since
private employers were reluctant to touch these workers due mainly
to the fear of having to deal with the union. Nonunionist Argentine
workers never envisaged taking action unilaterally or collectively to

contest privatizations because they felt weak against the institutional
and historical power of the unions. The leading rationale was: Even
if unions are for privatizations, what does it matter what I think or
do? In Turkey, on the other hand, leftist and rightist workers affected
or not affected by privatizations defied them on ideological grounds
and acted along the lines adopted by their political party of choice . As
examined in more detail in the next chapter, the historically impor-
tant place of the political parties and unions as drivers of political
change in Turkey and Argentina, respectively, might have determined
the distinct attitudes adopted by the Turkish and Argentine workers
toward privatizations.
Although neither the Turkish nor the Argentine workers increased
their political participation or changed their voting patterns as result of
privatizations, a third difference among the social outcomes of priva-
tizations at the individual level of analysis concerned the emergence
of collective action and social movements. In Turkey, privatizations
generated a provisional but a vibrant social movement of the rank and
file, due mainly to the workers' perception of the unsatisfactory han-
dling of privatizations by the ir labor unions. Privatizations did that
by increasing the lack of trust between union representatives and the
rank and file, thereby driving the latter to take its destiny into its own
hands and mobilize outside the scope of the unions. Privatizations
did not create an immediate movement of anti-privati zations coming
from the rank and file and devoid of union support in Argentina.
CONCLUSION: IMPACT OF PRIVATIZATIONS

ON UNIONS AND WORKERS IN ARGENTINA
The analysis of the impact of privatizations on Argentine labor shows
that the labor institutions were affected by them. Privatizations
provided the necessary stimulus for a group of anti-privatization
Argentine labor unions to secede from the CGT and to form the new
institutional formation, the CTA, which was much more amenable
to democratization. From the 1990s onward : (1) the CTA-affiliated
unions were fully cooperating with each other and civil society orga-
nizations at local, national, and international levels; (2) the CTA sup-
ported the democratization of the labor structure as well as that of
the political system as a whole; (3) the CTA gave in to the demands
of its rank and file to introduce direct and secret elections of its
secretary-general; and (4) the CTA opened its doors to the unem-
ployed, the retired, and social movements such as the ON. The CGT
and its structure stayed relatively intact during the privatizations.

Nonetheless, the CGT also (1) undertook several research activities to
analyze privatizations; (2) created research organizations, including
the CATEP,. and (3) cooperated, albeit regionally, with the CTA-
affiliated unions .
The MTA, the once equivalent of the CTA within the CGT, became
extinct once its leader was chosen to lead the CGT itself. While this
showed the enduring power of the existing Argentine labor structures,
the CTA remained as a separate organization. The CCC's formation
was less directly related to privatizations since only a minor group of
former state employees were included within its body. The CCC was
instead a creation and the institutionalization of the piquetero move-
ment in Argentina . This did not prevent many labor scholars to dub
it as the "union of the unemployed," however. All of these organiza-
tions searched for ways to adapt to the changing economic conditions
and tendencies of a globalized world. One reason why the Argentine
unions were engaging in these activitiesis because privatizations' nega-
tive impact on unionization and employment forced them to find new
ways of doing union politics. As such, the perceptions of privatizations
and the expectations about their negative consequences, and not priva-
tizations per se, acted as an invisible hand in producing the unintended
changes in the Argentine labor institutions and politics.
The analysis of the impact of privatizations on Argentine workers
shows that the effects of privatizations on individual workers are
not strong either in the short or the long run . Privatizations seldom
changed the political activity and the nature or degree of participation
of workers affected by them. Unionist workers who were active mem-
bers of their unions and who had some representative position in them
continued to be so after the privatizations . These were also the work-
ers who could partially escape the negative effects of privatizations
thanks to the institutional and political power of their unions . Some of
them even benefited from privatizations by using them as a means for
self-enhancement educationally, professionally, and financially.
A vibrant social movement by the rank and file devoid of
union support was not formed and possibly not even envisaged in
Argentina. The only social formation that came close to such an inde-
pendent mass organization was the ON. The latter, however, became
a member of the CTA as soon as it came into being . Its members were
also members of the CTA. These and other accounts by the Argen -
tine workers reaffirmed the still substantial institutional, political, and
symbolic power of the Argentine unions in the minds and lives of the
Argentine working class.
These findings from Argentina show that privatizations created

highly similar results in the institutions of labor there as in Turkey.
These can be seen in the tripartite division of the respective labor
institutions and their taking distinct attitudes toward privatizations.
This analysis has also shown that privatizations have produced slightly
dissimilar results on individual workers in Argentina and in Turkey in
terms of their responses to privatizations. These can be seen in the
formation of the mass-based OM in Turkey, created without union
assistance, and the lack of an equivalent creation in Argentina. Why
have privatizations had convergent effects on institutions and diver-
gent consequences for individuals? Why has the collective organiza-
tion of workers in Turkey not been a long-term social movement
leading to the ultimate and dichotomous outcome of individual apa-
thy versus institutional change? While possible answers to this puzzle
are complex enough to constitute a topic of its own for a separate
research project, tentative solutions can be found in the respective
histories of political development in Turkey and Argentina.
CHAPTER 6
EFFECTS OF PRIVATIZATIONS
ON LABOR
A CROSS-CULTURAL COMPARISON
AND IMPLICATIONS FOR DEMOCRACY
Many students of political economy argue that privatizations, by

being standard recipes for shrinking an overarching and inefficient state,
produce similarsociopolitical consequences in different countries . Priva-
tizations, in this view, enable a better allocation of resources, the efficient
use of market resources, and possibly, political liberalization.1 Other stu-
dents of political economy, on the other hand, take a sociological neoin-
stitutionalist or even a culturalist perspective to argue that privatizations
produce divergent results depending on the country or the region
implementing them .' They argue that increasingly uniform institutions,
practices, and policies brought about by privatizations do not mean that
there is a unifying paradigm for analyzing the effects of privatizations on
workers and labor unions (Candland and Sil200l, 285).
It is true that labor institutions and movements vary from country
to country and region to region. These country- or region-specific
variables, in turn, significantly influence what effects privatizations
produce in any given context. The findings of this study warrant
the need for a middle -ground approach between the usually pro-
privatizations universalists and the anti-privatizations contextualists.
It suggests that privatizations do not produce the same results in dif-
ferent countries implementing them. Nor do they produce completely
divergent results depending on the country and contextual factors .
Privatizations produce highly similar changes on institutions, which
184 D EMO CRATIC INSTITU TIO NS
craft similar strategies to adapt to the changing social and political

parameters created by privatizations. However, the convergent effects
of privatizations on institutions do not replicate themselves at the
individual level. Privatizations affect citizens of different countries in
different ways. The comparative analysis of the cases of Turkey and
Argentina shows that there is a high likelihood that privatizations cre-
ate convergent institutional changes in the labor unions but divergent
responses on the part of individual workers, at least in the short run.
From a democratization perspective based on social mobilization and
institutional adaptation, the fact that institutions, and not individuals,
adapt to the changing circumstances in the long run brings the
conclus ion of this study that privatizations have democratized the
labor unions in Turkey and Argentina, but not the individual workers .
These tendencies and links are summarized in Table 6.l.
The finding that labor unions have changed as result ofprivatizations
is controversial. Unions around the world are stigmatized as corrupt
and anachronistic entities. One Turkish scholar likened Turkish labor
unions to "parasites" for always supporting the government of the day
and living off of it.3 Maurizio Atzeni and Pablo Gigliani (2007) main-
tain that old trade union practices have prevailed in Argentina, while
Sebastian Etchemendy and Ruth Collier (2007) argued that traditional
cooperative approaches have dominated in union-state relations. While
sometimes recognizing the change and deeming it important requires
comparing it with the other, it is also a matter of seeing the glass half
Table 6.1 Pedagogic snapshot of Turkish and Argentine organized labor after
privatizations
Co untry Level of Analysis Outcome relevant for Democratizati on
Individual SR: + o Some learning experience of demo-

cratic participation and contestation .
LR: o Temporary formation of the loose
Turkey OM movement.
Institutional Int ernal: o Increased autonomy, new unionism,
External : + coop eration , and explicit demand s of
Structural: + democratization .
Individual SR: o No grassroots mobilization devoid of
union backing and only one detect ed
Argentina LR: (Oro Negro) with it.
Institutional Internal : o Increased autonomy, new unionism ,
External: + and demands of democratization
Structural : + mostly in the CTA. Cooperation
mostly regional.
EF F E CTS O F PRIVATI Z ATIO N S ON L ABOR 185
full instead of half empty. Opting for what Albert Hirschman (197 1)
called "Bias for H ope " in his analysis of the development process
in Latin America, the transformation of labor union s in Turkey and
Argentina observed in this stu dy and the accounts given by union
leaders at various levels of union hierarchy and in different secto rs of
activity show that chang e is gradu al but visible. In fact, studies arguing
otherwise off the bat tend to be single-case studies relying exclusively
on descriptive statistics of union density, labor conflicts, and the num-
ber of collective agreements made per year.
Labor union s and workers, as the entities most directly and signifi-
cantly affected by privatizations, constitute a fertile ground of study to
gauge the social and political effects of privatizations at the institutional
and individual levels of analyses (Posusney and Cook 2000, 1). Con-
vergent institutional changes privatizations bring about in labor union s
can be categorized as structu ral, organi zational, and functional trans-
formations in the labor institutions. Divergent individual changes that
privatizations bring about in workers' political attitudes and behaviors
can be categorized as individual) partisan or unionist, and collective.
CONVERGENT INSTITUTIONAL CHANGES SPURRED

ON BY PRIVATIZATIONS
The comparative histo ries of th e development of labor in Turkey and

Argentina have shown th at the se two countries have highly dissimilar
labor institutions. In pre -Peron Argentina, the evolution of th e labor
unions was characterized as a bot tom-up proce ss led by a relatively
hom og enous group of European imm igrants divided along ideologi-
cal lines (ArIarchist-Socialism-Syndicalism-C ommunism) but working
toward the establishment and protection of workers' rights. With th e
emergence of Peron and his ideological template of Peronism from
th e late 1940s onward, the Argentine labor movement and institu-
tions have become polariz ed along th e Peronist versus non-Peroni st
discourses and allegiances. Argentine labor unions have always been
one of the major players in th e Argentine political landscape . As for
the ind ividual workers, they have existed as long as and to the degree
to which they have been union members and activists. Peronism, in
this sense, has often acted as both a bulwark against increased worker
mobilization and a catalyst of union-led collective action .
This panorama is in sharp contrast to the sultanistic regime of
th e Ottoman Empire , where labor activism was hardly an issue for
an emerging workforce stro ngly divided by acute ethno national-
ist allegiances rekindled by involvement, to one degree or another,
in consecutive world wars. The evolution of labor unions in the

newly established Republic of Turkey has followed the same logic of
political centralization whereby unions were established top-down
by the state and with the objective of buttressing state power, and
never as a counterweight locus of authority. Although the voice and
political influence of unions increased temporarily in the 1970s, the
military intervention of 1980 was highly effective in putting an end
to labor's brief supremacy. As for Turkish workers, their allegiance to
their unions has seldom become an issue, neither for ideological nor
for interest-based purposes.
While Peronism unified the ideologically divided Argentine
working class starting with the 1940s, Turkish labor never had a
unifying leader or ideology. Instead, it was the left-right political
schism that defined and shaped the emerging Turkish labor institu-
tions in the 1950s. As a result, the Argentine labor union system
evolved into a corporatist and Peronist stronghold, while its Turkish
counterpart grew to be more plural and partisan. Although powerful
in both cases, the state maintained a much more explicit and institu-
tionalized hegemony over the labor unions in Turkey than it was the
case in Argentina. In Turkey, the control of state was more obvious
and strong than in Argentina where the state controlled the labor
unions through more subtle means and always within the scheme
of a sui generis corporatism. Coupled with the Peronist project of
the empowerment of the working-class, which in reality meant the
empowerment of Peronist unions and union leaders, the Argentine
labor unions grew to be much stronger and important political actors
than their Turkish counterparts, who rarely played a comparable role
in the Turkish political system.
In addition to the differences in their labor histories, Turkey and
Argentina are hardly alike on any background criteria that could have
contributed to the convergent changes observed in the evolution of
their labor institutions in the post-privatizations period. Turkey is
Muslim, while Argentina is Catholic. Turkey is a centralized state
with a multiethnic population composed of Turks, Kurds, Zazas,
Circassians, Laz, Hemshins (Armenian Muslims), Pomak, Turkmen,
Arabs, Romans, Caucasians, Georgians, Bosnians, Albanians, and
others. Argentina has a federal system with an ethnically homog-
enous population-97 percent of which are of Spanish and Italian
origins. Turkey has a parliamentary system, while Argentina is a
presidential system . Coupled with the disparities in the historical
and institutional underpinnings of Turkish and Argentine labor
movements, it is interesting to note that globalization starting with
EFFECTS OF PRIVATIZATIONS ON LABOR 187
the mid-1980s in both countries has gone hand in hand with similar
developments in their labor institutions. Privatizations have been
an important factor contributing to these convergent institutional
changes, which can be grouped under the following three main
headings.
Structure of Labor Unions: Divisions and Reticent

Collaboration
Privatizations have either deepened the divisions within the labor
union system or contributed to the creation of new splits on the
basis of the distinct responses to privatizations of different unions,
or both. In Turkey and Argentina, privatizations have played a major
role in the creation of the tripartite labor union systems composed
of "business unions," which explicitly and actively participated in
privatizations; "traditional unions," which implicitly and passively
participated in privatizations; and finally, "civic unions," which con-
tested privatizations and did not participate in them. Business unions
have employed tools of socioeconomic unionism based on financial
strategies; traditional unions have mostly resorted to political union-
ism based on a mixed strategy of partisanship and pragmatism; and
finally, civic unions have drawn on ideological and intellectual means
of unionism based primarily on social mobilization and protest.
The business unions in Turkey were those affiliated with the pro-
privatizations labor confederation HAK-IS. In Argentina, business
unions were represented by the more independent and less traditional
branch of the labor confederation CGT, or the so-called Gordos.
The traditional unions that were implicit proponents of privatizations
without, however, an active enrollment in them were the affiliates of
the largest labor confederation TURK-IS in Turkey. The counterpart
of TURK-IS in Argentina was the traditional and more loyal Peronist
group of unions within the CGT, or the so-called MTA, and other
Menemist unions, which opted for loyalty to the Peronist party
and Peronist politician Menem. Finally, the civic unions that con-
tested and searched for alternatives to privatizations were those
affiliated with DISK in Turkey and the CTA in Argentina. In addi-
tion, the unemployed organized and institutionalized street protest
demonstrations in Argentina. This brought into being an additional
labor organization, the CCC. The CCC was only an indirect upshot
of privatizations, however, since the rationale for its foundation as
well as the objectives it set out to accomplish were only indirectly and
partially related to privatizations.
The tripartite division of the Turkish and Argentine labor systems

depended mainly on their distinct reactions to privatizations. The
coincidence in the patterns of fragmentation of the labor institu-
tions in these otherwise quite different countries is interesting in
itself. One other important finding of this study, however, is that
each of the three groupings of labor unions also adopted a distinct
approach toward democratization in their respective countries. The
business unions in both Turkey and Argentina used privatizations
as a means of financing social service projects for their members. As
such, they equated, albeit in different degrees, their participation in
privatizations and the diminishing role of the state in economics with
the expansion of civil society and the private sector. The traditional
unions in Turkey and Argentina used privatizations as a means of
gaining easy access to information thereby questioning the actions
of governments and employers. As such, they became intermediary
organizations of deliberation and negotiation between the political
elite, the rank and file, and the private sector. Finally, the civic unions
in Turkey and Argentina used privatizations as a challenge against
which to reinvent themselves as active supporters of the democratiza-
tion of their respective political systems.
In each of the three cases, privatizations acted as an invisible hand
to promote a democratic transformation at the institutional level.
Privatizations did that because they were seen (1) as a means of
financing and expanding services and civic space for members of the
business unions," (2) as a means of access to information and becom-
ing less partisan in the case of the traditional unions, and (3) as anti-
labor projects to defeat in the case of the civic unions . In other words,
privatizations per se do not seem to have forced the labor unions to
take a sudden interest in democratization, but the implications or
perceptions of privatizations unintentionally do.
External Role of Labor Unions:

Autonomous Negotiation and Stateness
The fragmentation of labor unions based on their stand on privatiza-
tions has not meant an automatic decrease in their power. Divisions
have brought a different, and not necessarily a weaker, role for the
labor unions in Turkey and Argentina. Privatizations have disrupted
the historically intimate and partisan links attaching the labor unions
to political parties of various ideological and political backgrounds.
In the case of Argentina, privatizations have played a role in shaking
the Peronist links between the CGT and the Peronist governments.
EFF ECTS 0 F P R I VAT I ZATI 0 N SON LAB 0 R 189
As a result, various unions affiliated with the CGT have come together
to secede and to form their own alternative institutions. Such fissures
and the resultant new groupings have not meant a decrease in the
strength of the Peronist ideology. They have signaled instead a new
era of multiplication of Peronist ideologies, whereby different groups
have focused on distinct pillars of Peronism to understand and inter-
pret it differently. The diversification and the infusion of pluralism
into the Peronist template have contributed to the emergence of
more open and pragmatic labor unions as more independent actors
in the political decision-making processes.
Privatizations have also changed the role and image of the state,
which also has become more autonomous in its dealings with the
labor unions. Partisanship has not disappeared between the Peronist
labor unions and the Peronist governments in Argentina. It has, how-
ever, become mitigated. This has increased the autonomy of the state,
which then has gained leeway in dictating the rules of the game . The
game of privatizations has included the privatizing state as the "prin-
cipal" or the "patron," and the labor unions of the privatized sectors
as the "agent" or the "clients."
As in Argentina, privatizations in Turkey have also changed the
nature of the links between the state and the labor unions. The
gradual mitigation of the partilerustu politika or the "politics of
above parties (PAP)" provides a good example of the weakening
partisan ties between TURK-IS and the state . PAP was a doctrine
of the Turkish labor unions, used particularly by the largest and
official labor confederation, TURK-IS, to pursue an implicitly politi -
cal and partisan unionism. In practice, PAP signified a simple quid
pro quo relationship whereby labor confederations mobilized their
affiliates' votes in order to support a given government regardless
of its democratic credentials . The latter, in turn, would let union
leaders govern independently while bestowing additional political
and economic privileges on them once in power. Since Turkey did
not have an equivalent labor ideology to Peronism, PAP could be
exercised with many governments of different political affiliations,
not just with one political party with a particular ideology. Privatiza-
tions shook the PAP principle of patron-client dealings between the
Turkish state and the labor unions. The indignation of certain unions
within TURK-IS against this confederation's implicit acquiescence
to privatizations and their subsequent regroupings to protest both
privatizations and PAP can be cited as evidence.
The state was powerful in both Argentina and Turkey before
the privatizations. In Argentina, the corporatist system of political
decision making was likened to "state corporatism" more so than to

"societal corporatism .t" As such, the state had substantial authority
over the labor unions. Yet, labor unions still had a legitimate and a
relatively strong say in the decision-making processes when compared
with Turkey, where the idea of the "Father State" iDevlet Baba) per-
sisted . Nevertheless, privatizations increased stateness in both Turkey
and Argentina. This meant an increase in the capacity of the state to
specify the terms of economic interaction, to extract resources, and
to determine the administrative procedures (Schamis 2002, 192).
Stateness meant a less patrimonialist and a more professional state in
Turkey. It meant a more pragmatic and more open state in Argentina.
Stateness, as such, played a positive rather than a negative role in the
democratization processes of Turkey and Argentina.
There is, however, a caveat for privatizations to increase stateness,
and thereby contribute to the democratization pro cesses in Turkey
and Argentina. Too much increase in state power can translate into
the arbitrary or personalist rule of the political leaders. Single-handed
policymaking by the increasingly popular AKP government and by
President (former Mr. or current Mrs .) Kirchner in Argentina would
not bode well with democratization. For privatizations to contribute
to democratization through stateness, it seems that a modicum of
democracy, including the existence of adequate and well-function-
ing mechanisms of accountability, is a requirement. In other words,
it appears that the democratizing effects of privatizations on labor
institutions might come into effect only if kernels of effective and
democratic political institutions are already in place.
There is also a second caveat for privatizations to contribute to
the democratization process . This concerns their contribution to
the increasing autonomy of labor unions. Although the increasing
autonomy of labor institutions makes them important actors of
civil society, their increasing independence must not end up in the
strengthening of the power of individual labor union leaders . It is a
glaring fact that privatizations have not led to the turnover of the
old and seemingly corrupt labor union leaders in neither Turkey nor
Argentina. Much to the contrary, many of these union leaders have
used privatizations to enrich themselves and build on their already
substantial political power. Privatizations, therefore, should be chan-
neled into growing "institutional" and not "personal" autonomy
in order for democratization to ensue . Generational change in the
ranks of union leaders and adequate mechanisms of accountability
can assist privatizations in striking the right balance between stateness
and autonomous unionism.
Internal Functioning of Labor Unions:

Same Organization, New Styles
Privatizations do not seem to have had a significant impact on the

internal workings of the labor unions either in Argentina or in Turkey.
Privatizations, in other words, have not perpetuated changes in the
internal organization and electoral systems of the labor institutions.
This finding is important in and of itself since it challenges Fiorito,
Iarley, and Delaney's (1995) hypothesis that privatizations can bring
about a more democratic internal reorganization of unions (618) .
The absence of change at the level of internal union elections
does not mean, however, that the impact of privatizations has been
nil at this level of analysis. As a result of privatizations, a new type
of union leader has emerged at the local level of union representa-
tion. The new union leaders at the local union branches in Argentina
were younger, more educated, less politicized, less ideological, more
pragmatic, more ambitious, highly familiar with financial markets
and their ups-and-downs, and often enrolled in higher education
programs in tandem with their union jobs. In Turkey, the same thirst
for professional unionism at the local level of representation was
also present among the union leaders. 1 found them to be greatly
involved in political and economic research activities, regardless of
their union affiliation and political ideology. The need to understand
privatizations and to construct more viable strategies to deal with the
changing circumstances spurred on by them had brought these union
leaders to forge extensive links with civil society representatives at
both the national and the international levels.
In addition to the emergence of a new union leader identity,
"alliance systems" and traits of "new unionism" were also present in
Argentina and Turkey. An alliance system or new unionism can be
defined as amplified links of interaction and cooperation between
labor unions and other social organizations. Increased interaction
and collaboration between the labor unions and civil society imply
more extensive and deeper roots of labor within local communities
(Klandermans 1990, 20). Privatizations have played a considerable
role in stimulating union collaboration with civil society organiza-
tions of various convictions and activities. Privatizations have pushed
labor unions to establish links with various universities and other
institutions of higher education for the purposes of collaborative
research, publication, and the training of union members. Privatiza-
tions have also led many unions to include associations of former
union members or the unemployed in their ranks. Privatizations have
engendered interest on the part of unions in their counterparts in

foreign countries in order to seek advice, collaboration, and partner-
ships. Privatizations have promoted extensive research and publishing
activities undertaken by the labor unions on the themes of privatiza-
tions, globalization, and democratization. The strengthening of social
ties between anti-privatization unions and nongovernmental organi -
zations at the local, national, and international levels have been the
defining characteristics of both the eTA in Argentina and the DISK
in Turkey.
DIVERGENT INDIVIDUAL CHANGES

SPURRED ON BY PRIVATIZATIONS
While privatizations have resulted in similar structural, external,

and internal transformations of the labor institutions in Turkey and
Argentina, their effects have not reached the individual level, at least
not in the short run. This study has concluded that privatizations
do not seem to have a significant impact on the individual political
attitude and behavior of the rank and file. In fact, both the Argentine
and the Turkish workers gave one common answer to the question
of whether or not privatizations have rendered them more active
politically. The ubiquitous answer was no. They suggested that an
individual, who is politically conscious, continues to be so after priva-
tizations. They reasoned that privatizations constitute at best a catalyst
for a temporary increase in the level of political activism of individuals.
Thi s is an important finding because it shows that privatizations per se
do not contribute to changes in the nature or the level of political par-
ticipation among blue-collar workers even though they may consider-
ably alter their income level as well as their social standing in society.
While privatizations do not seem to have had a significant impact
on the nature or level of political activity among workers, the Turkish
and Argentine workers conceive privatizations differently and react to
them differently. Turkish workers negatively affected by privatizations
voiced indignation, while the younger and the more educated among
them mobilized to demand restitution through collective action.
Their Argentine counterparts, on the other hand, voiced helplessness
and isolation, with no actual or planned projects of collective action
or mobilization. The Turkish workers' positions vis-a-vis privatiza-
tions seemed to be determined by partisanship and where they
placed themselves on the left-right political spectrum. The Argentine
workers' stands on privatizations, on the other hand, were very
much influenced by unionismo, that is, whether they were active
union members or not. The distinct reactions of the Turkish and

the Argentine rank and file to privatizations can be grouped under
three separate strategies : individual-Jamily, partisan or unionist, and
collective-social.
Individual/Family Networking Solutions: Most of the workers,
who lost their jobs or who were forced to seek early retirement as a
consequence of privatizations, chose to resort to their families as their
main source ofemotional and financial support. Accordingly, the typi-
cal post-privatization activity ofa retired Turkish worker was to return
to his hometown in inner Anatolia and become a shopkeeper, a taxi
driver, or a farmer. Since most Turkish workers had a family business
or land in the cities of inner Anatolia, they already had viable alter-
natives of social and economic resources apart from their job in the
SOEs. As for the older Argentine workers who chose the path of early
retirement, they also went to their homeland in the interior of the
country and invested their compensation money in a variety of small
business ventures. These resulted in an explosion of kiosks, taxis, and
small grocery stores in Argentina, most of which went bankrupt due
to the exceeding levels of supply over demand.
The workers who lost their jobs as result ~of privatizations
seemed to be better off in Turkey than in Argentina. Some possible
explanations for the difference might be found in the much higher
poverty rates in Argentina (36 percent as of 2006 measured as an
average of all poverty indices) than in Turkey (20 .4 percent as of
2005 measured as an average of all poverty indices) ." While increase
in poverty levels can be partly attributed to privatizations, Argentine
privatizations ended up in much higher unemployment rates than
did privatizations in Turkey, where the strategy of reallocating the
downsized workers, particularly through the famous 4-C clause,
dominated (See figures 6.1 and 6.2) . Finally, the dominance of
single-family small landholders in Turkey contributed its fair share
to the mitigation of the negative effects of privatizations on workers .
This was in contrast to Argentina where large estancias owned by
a few rich families have constituted the main arrangement for
landholding."
Partisan or Unionist Networking Solutions: Younger Turkish
workers who were downsized as a result of privatizations crafted
a new strategy of using their political party affiliation as a possible
source of support in dealing with the negative consequences of
privatizations. They became active members of different political
parties and used their connections there to recuperate jobs in the
post-privatizations period.f This innovative technique of overcoming
300000 20
250000
IS
200000
150000 10
100000
5
50000 --+- Employment
_ Unemployment
0 0
85 86 87 88 89 90 91 92 93 94 95 96
Source: Duarte (2001).
Figure 6. 1 Employment and unemployment levels as a result of privatization in

selected public sectors in Argentina (1985-1996 ).
(in absolute values and percentages)
35000
II II0 Unaffected
Laid off workers
wo rkers
I
30000
25000
20000
15000
10000
5000
-I I I_ ~ " 0 t;;;I
Source: Based on the unpublished data provided by Privatization Administration in Ankara,

Turkey (August 2005).
Figure 6.2 Emp loyment and unemploymen t levels as a result of privatiz ation of
SOEs in Turke y ( 19 89- 2005 ).
(In absolute values)
the negative impact of privatizations was in perfect harmony with the

main characteristic of the Turkish working class as being political and
partisan. The historical account of the Turkish labor union system
in Chapter 2 described the latter as weak, dispersed, and divided by
political affiliations of left and right. As such, some Turkish workers
used this characteristic to their advantage to cope with the negative
effects of privatizations.
In Argentina, the labor union system was neither weak nor dis-
persed. It was, in contrast, strong and centralized. As a result, many
Argentine workers who were active in their respective unions, either
in top positions or as floor representatives, were usually protected
by the negative impact of privatizations. These workers kept their
jobs and their positions within the union. This is the case for both
the leftist members of the CTA, which contested privatizations, and
the Peronist members of the CGT-affiliated unions, which supported
and participated in privatizations. Union activism did not provide a
comparable protection in the case of the Turkish workers .
In Argentina, the relatively younger, more ambitious, and less
ideological unionists were more than protected by privatizations.
They actually used privatizations to engage in entrepreneurial activi-
ties with the political and organizational support of their unions . This
was the case for the UOM affiliates in San Nicolas and the gas sector
worker in Cordoba. Many of these younger unionist workers of the
pro-privatization unions acquired education and training in areas as
diverse as psychology, business administration, economics, human
resources, and sociology. In Turkey, the tools of privatizations such
as loans for small and medium enterprises (microemprendimientos, in
Spanish) and outsourcing (tercerizacion, in Spanish) were not as prev-
alent as in Argentina as of 2005 .9 Therefore, comparable accounts of
the use of privatizations for workers' individual professional success
and self-improvement were not as common.
Collective/Social Mobilization Solutions: This was the type of
answer to privatizations where the Turkish and the Argentine workers
differed the most. A group of Turkish workers decided to organize
and mobilize against privatizations seeing that their unions were
not taking any significant action to protect the benefits of the rank
and file. As such, the social organization of the Victims of Privatiza-
tions (Ozellestirme magdurlari, OM) was born. The OM was the
prime example of a vibrant and nonviolent protest movement against
privatizations. It was a movement started and led by the downsized
rank and file and independent of union support. Although a loose
and temporary association of workers engaging in sporadic collective
action from different regions and cities of the country, the OM was
important because it was solely and directly about privatizations: it
was formed after the privatizations and because of them. The OM
was also the first overtly anti-union and entirely grassroots-based
social movement. Using innovative methods of protest, such as mass
divorces, the OM succeeded in its pragmatic goal of landing jobs in
the formal market for its adherents. While smaller in size and less
popular today, the links forged between the recently unemployed as
result of privatizations and the now employed founders of the OM
have persisted. The workers' reactions to privatizations in Turkey and
Argentina are summarized in figures 6.3 and 6.4.
In contrast to the Turkish case, Argentine workers who were nega-
tively affected by privatizations, and who did not enjoy the support
PRINCIPAL TOOL PRINCIPAL REACTION

u;
'§ older Family Connections pragmatic. Individual
'2
::>
c
:;@
younger
Immigration
.
pragmat,c • Individual
WORKER TYPOLOGY
Left
u; Union-bounded
'2 ideological protest
o
'2
::> All ages Union Connections Peronist Union-bounded
pragmaticnegotations and/or
Small business
Renationalized
Union-bounded
ideological
protest
Figure 6.3 Worker typology and reactions to privatizations in Argentina : Pragmatic

reasoning and union-bound action taking.
PRINCIPAL TOOL PRINCIPAL REACTION
Iolder
Family Connections..- Individual
~VO"M IdeologIcal
WORKER TYPOLOGY Young Party Connections . . - Clientelist

& partisan pol,tlcal
Young Social Movements . . - Collective

& non-partisan ideological
Figure 6.4 Worker typology and reactions to privatizations in Turkey: Ideological

reasoning and collective action taking .
of their labor unions, did not envisage forming any sort of social
organization, nor did they engage in collective action to obtain com-
pensation. The leading rationale in the mind of an Argentine worker
was "In a world where even the labor unions support privatizations,
what does it matter what I think or do?" These and similar responses
coming from Argentine workers of various geographical, profes-
sional, educational, and ideological backgrounds attested to the still
high symbolic power of the labor unions in the eyes of the workers.
This was definitely dissimilar to the typical Turkish worker's response
on this same issue: ((We cannot be with the unions but we cannot be
without them either. Being without a union isprobably worse than being
a member of the worst union . . . ))
It would be safe to say that in the case of Argentina, privatizations
did not produce any large-scale social movement or organization on
the part of workers affected by privatizations. Individual solutions
for those outside the union framework and union-related solutions
for those inside it dominated. The only minor exception to this
trend was the Black Gold (Oro Negro, ON) movement. The ON
movement was started in 2001 by the downsized workers of the
former state-owned petroleum company, YPF. The main ideological
template of the movement came from General Enrique Mosconi, who
had directed the state-owned YPF starting in 1922. The principal
objective of the movement was the renationalization of the petro-
leum sector. The ON became part of the unofficial labor confed-
eration of Argentina, the CTA, as soon as it was formed . The ON,
thus, became part and parcel of the Argentine labor union system.
The ON experience corroborated among other things that collective
solutions were possible in Argentina only within the framework of
union structures.
Oro Negro (ON) differed substantially from the social movement
of the Victims of Privatizations (OM) in Turkey. First, the ON in
Argentina came into being almost a decade after the actual privatiza-
tion of the plant even though the OM in Turkey was a spontaneous
reaction to the massive downsizing that was a result of the privatiza-
tion of the same energy sector. Second, the ON in Argentina aimed at
the renationalization of the energy sector as a whole, while the OM in
Turkey aimed only at securing jobs in the formal economy. Third, the
ON in Argentina quickly became institutionalized and affiliated with
the labor confederation of the CTA. This is in contrast to the experi-
ence of the OM in Turkey, where the movement remained a loose
and informal association of self-appointed regional leaders, distinct
from the labor unions.
INSTITUTIONAL SIMILARITIES AND INDIVIDUAL

DIFFERENCES: Two HYPOTHESES
This study has shown that privatizations have created highly similar
changes in the labor institutions in Argentina and Turkey. These
similarities can be seen in the tripartite division of the labor sys-
tems, the distinct attitudes toward privatizations held by each of the
three branches, their distinct and innovative styles of participation
in decision-making processes, and the emergence of new types of
alliance systems and identities of union leaders at the local level of
representation. More fragmented structurally, but collaborative stra-
tegically, labor unions have become more autonomous and active in
their dealing with the state, the private sector and the civil society.
As a result of privatizations, labor unions have also engaged in
extensive research and analysis of financial markets, political systems,
privatization schemes, and labor strategies. Increasing stateness,
mounting social activity, and the interconnectedness of the labor
unions, as well as less partisan nexuses between them and the state
suggest the possible democratizing effects of privatizations on labor
institutions.
Privatizations have produced slightly dissimilar results on indi-
vidual workers in Argentina and Turkey in terms of their responses
and reactions to privatizations. Although privatizations have not cul-
minated in increased political activity in either Argentina or Turkey,
workers have reacted to privatizations in different ways in the short
run. These different reactions can be seen in Turkey in the formation
of the mass-based organization OM by the rank and file and devoid
of union assistance, and the lack of an equivalent workers' initiative
in Argentina . Why have privatizations produced collective action and
mobilization in Turkey, while they have failed to do so in Argentina?
Does the lack of worker mobilization in Argentina and the dearth
of longevity of Turkey'S OM point to the fact that privatizations
have rendered individuals more apathetic, atomized, and thence, less
democratic in the long run?
The divergence in Turkish and Argentine workers' short-term
responses to privatizations cannot be the distinct implementation of
privatization plans since we have already seen that the privatization
programs applied in Turkey and Argentina were similar to each other
in many respects. Privatizations in both Turkey and Argentina started
slowly and took off with the arrival of popular political figures such as
Menem in Argentina and Ozal in Turkey. These two leaders were highly
similar to each other in their charismatic attributes, eclectic strategies
of combining neoliberal tools with patron-client tactics of cooptation,

reliance on technocratic style of policymaking, and their centralization
of political power. In addition to the resemblence between the gover-
nance strategies of the Argentine and Turkish political leaders and their
governments, privatizations were associated with increased corruption,
lack of adequate monitoring, and excessive concentration of economic
power in both countries as elsewhere in the developing world . Finally,
the same logic of reluctance ofprivatizing public goods and services has
dominated the political debate in Turkey and Argentina .
Two possible explanations for the divergent effects of privatiza-
tions at the individual level of analysis in Turkey and Argentina can be
(1) the background conditions of privatizations and (2) the dominant
templates of nation building. The first possible explanaory factor, the
background conditions, refers to the degree of former economic and
political crises that afflicted each of the two countries. The second
possible explanatory factor, the dominant nation-building project,
refers to the principal frameworks of ideas that were at the roots of
forming and unifying the Turkish and Argentine nations, respectively.
These ideological building blocks refer to Peronism in Argentina and
Kemalism in Turkey.
Background Conditions: Previous Political

and Economic Crises
One possible explanation for why privatizations produced collective
social action by the rank and file in Turkey, and not in Argentina,
can be found in the divergent degree of economic and political crises
experienced by these two countries before privatizations. Accord-
ingly, it can be argued that Turkey has never had a hyperinflation in
the way and to the degree that Argentina has. Nor has Turkey ever
witnessed a military dictatorship whose duration, level of oppression,
and brutality equaled those of the Dirty War in Argentina. In fact, the
economic terror produced by hyperinflation and the political terror
of the military dictatorships were two of the most frequently cited
reasons by Argentine workers for their lack of reaction and mobiliza-
tion against the negative effects of privatizations. By the same token,
the transition to democracy and the gradual normalization of social
and political relations in Argentina were other reasons cited for the
recently increasing rank-and-file activity against privatizations in
Argentina. The fact that Turks never saw prices quadruple minute-
by-minute might have rendered them less fearful in general and
more amenable to engaging in protests of privatizations than their
Argentine counterparts. By the same token, the fact that the 1980
military coup in Turkey lasted only three years and ended with a
smooth and gradual transition to democracy might have made the
Turkish workers more forceful in contesting the privatizations.
While the differing background conditions relating to economic
and political crises might constitute a plausible explanation for why
the Argentine workers did not react to privatizations in the same way
the Turkish workers did, it seems problematic to measure and com-
pare degrees of hardships felt by different populations as result of cri-
ses. After all, the real impact and intensity of economic crises is hard
to measure. This is because crises are perceived differently by mem-
bers of different societies due to their divergent past experiences and
future expectations. It might thus very well be that Turks perceived
the relatively milder economic crises in the pre-privatizations period
in Turkey as negatively as Argentines experienced the hyperinflations
in Argentina. In the same vein, the fact that Turkey did not witness
the equivalent of a Dirty War in the last 1980 military intervention
does not mean that the long political history of the country is devoid
of accounts of oppressive regimes and brutal episodes .
Dominant Nation-Building Templates:

Kemalism versus Peronism
The second possibleexplanation for the divergent impact ofprivatizations
at the individual level of analysis can be found in the dominant national
ideologies and their impact in Turkey and Argentina. The Turkish
nation-building project started with Mustafa Kemal Araturk and the
seeds for Kemalist ideology in the 1920s.10 The Argentine project of
national unification and development, in turn, awaited the emergence
General Juan Domingo Peron and his Peronist ideology in the mid-
1940s. While Kemalism consisted of the building of a secular nation-
state on the ruins of a theocratic empire, Peronism concerned the
rearrangement of class power between the rich ruling landholders and
the poor masses of workers. Accordingly, Mustafa Kemal was dubbed
the First Turk (Ataturk) by the emerging nation of Turkey. As for
Peron, he was named the First Worker (Cavarozzi 1988,6).
Kemalism and Peronism are hardly comparable phenomena. This
is because they happened in different periods of history, and there-
fore, were subject to dissimilar international circumstances. Kemalism
was born in the aftermath of World War I and Peronism emerged
after World War II. Kemalism and Peronism have one point in com-
mon, however : they both have shaped the soul and identity of their
respective nations and state institutions. Today, in almost all govern -

ment institutions, there is a portrait of Mustafa Kemal Araturk as the
liberator and founder of modern Turkey. By the same token, most
Argentine government institutions display on their walls portraits of
General Peron and his wife, Eva Peron, who also was greatly involved
in charity and social work. Peronism has molded the national and
popular conscience while reshaping the meaning of what it is to be an
Argentine (Surra 2003) . The six principles of the Republican Peoples
Party (Cumhuriyet Halk Partisi, CHP) founded by Ataturk also have
formed to a great extent the Turkish national identity. II At the very
least, Peronism and Kemalism have determined the national discourse
for decades, and probably centuries, to come in their respective coun-
tries.
From an economic perspective, although both Turkey and
Argentina adhered to a statist developmental model until the advent
ofneoliberalism in the mid-1980s, Ataturk and Peron's conceptions
of statism differed. Ataturk's statism (Devletcilik) was about keeping
private enterprise as the most important economic unit while having a
state-controlled economy in the interim (Aysan 1982,85). This type
of statism required the state to gradually de-nationalize government
companies so that balance could be maintained between government
and private enterprises (106) . The ultimate goal was economic
development, which Ataturk deemed indispensable for achieving
complete political independence (104) . Peron's statism, on the other
hand, required state to maintain harmony between capital and labor.
Economic development was not a goal in itself but only a tool for
achieving the happiness of Argentines toward "accomplishing the
greatness of the Nation." With that aim, "the state and organizations
of the people were to promote the nationalization of public services"
(Podesta 2004,310) .
Differences between Ataturk and Peron vis-a-vis economic devel-
opment were substantial. Their divergences vis-a-vis political develop -
ment were even greater. Ataturk wanted, first and foremost, to build a
secular and modern nation. He pursued Republicanism and the insti-
tution of an efficient party system as his main strategy of moderniza-
tion . In fact, Kemalism itself as an ideology was very much an ex-post
invention of the scholars of Turkish politics. Ataturk himself did not
intend or work to establish an ideology, but institutions (Giritli 1980,
1982a and 1982b). He said
The Republic of Turkey does not have a religion . Government

decisions, laws and all official deed s shall be done according to the
principles and requirements of positive sciences. Separating religion

from mundane affairs is indispensable to attain the level of modern
civilizations.
(Kocaturk 1999, 68)
Peron, on the other hand, wanted Argentina and Argentines to fol-

low his "third way." To understand and follow Peron's "third way,"
one had to be a Peronist . Peronism was a personalist movement against
the institutionalization of any type of power blocks other than the Per-
onist CGT. Peron pursued the ideals of an organized community and
the establishment of a strong, centralized, and Peronist labor union
confederation as his main strategy for reorganizing society. He said
The world has offered us two possibilities so far: capitalism and

communism. The alternative means for the efficient conduct of
government affairs is the Christian way that is nonpolitical, national
and social. This third way requires one to say no to the Yankees as well
as to the Marxists ... It requires one to be Peronist.
(McGuire 1997, 301-302)
As two great political leaders of the twentieth century, Ataturk

and Peron had very different goals and institutional projects in mind :
Ataturk believed in political institutions and political parties as the main
engines of political and economic development. He therefore estab-
lished the CHP as well as the TBMM even before the Turkish War of
Independence of 1919-1924 was over. Opposition parties sprang up
as early as 1924 . Ataturk encouraged the founding ofloyal opposition
parties that would not contest the defining features of the new Turkish
Republic, particularly secularism and republicanism (Zurcher 1993,
186) . Though imperfect, the basics of a procedural democracy, such
as periodic elections, political parties, and a national parliament, were
formed and left in place by the single-party rule of the CHP. A large-
scale mobilization of the population was never attempted (ibid., 194) .
Peron, in contrast to Ataturk, relied mainly on the mobilization
of the masses of Argentine workers for his project of rebuilding
Argentina. His nation-building project was about changing the
parameters of the power equation determining the respective place
and status of social classes within the Argentine society. Peron aimed
at the empowerment of the working class to the detriment of the
rich, landed aristocracy and the authoritarian military. To this aim, he
relied on social and political mobilization and not institutionalization.
He voiced his dislike of institutions and of political parties on many
occasions. He said "The Peronist movement is not a political party; it
represents no political groupings. It is a national movement .. . We

represent only national interests . . . The Peronist party exists only to
give spirit to the movement" (McGuire 1997,64-65).
Peron's view of political parties as obsolete organizations did not
mean that he was against all type of institutions. He thought labor
unions and not political parties were to be the leading organizations
in politics. He said "Unions, just like families, spring almost from
natural law . . . We still have a Peronist party because political parties
are a prejudice beyond which we have not evolved" (ibid ., 53, 64).
It was no surprise, therefore, that Peron exercised complete control
over the Peronist party. He could modify or annul the decisions of
the party, and inspect, intervene, and replace its constituent bodies at
will (McGuire 1997 ,62) .
By 1950, the CGT in Argentina had formally become synonymous
with the Peronist party itself. As Peron himself said "These days you
win elections like ours with unions, not political parties" (McGuire
1997,63). Peron used the CGT and the national unions to mobilize
support for elections and dispense welfare benefits. He established
tight, organic links between a "patron state" and its "client CGT."
To receive benefits, workers had to become affiliated with unions that
were affiliates of the Peronist CGT. Any anti-Peronist union or union
leader was banned from the CGT, and thereby declared illegal. Any
union that did not comply with the state policy,that is, with Peron, was
subject to intervention. Intervention implied the loss of the right to
sign collective agreements, the freezing of bank accounts, and/or the
replacement of union leaders with government-appointed trustees .
Things were very different on the other side of the hemisphere.
To quell opposition, Ataturk often resorted to institutional means,
such as courts and the promulgation of laws. Ataturk never envis-
aged calling the CHP he founded with his own name or identifying
it with his persona. Ataturk's emphasis on political parties and disci-
plined party systems are in stark contrast to Peron's favoring of labor
unions and union systems. Ataturk's project of secular modernization
and a veneer of democratization involving elections and political
parties during the initial authoritarian phase of the Turkish Republic
(1923-1946) stand out against Peron's project of the mobilization
of the working class using loyal and dependent labor unions as his
main instruments.
This institutionalist versus movementist contrast also provides
important clues on the idiosyncratic evolution of the national psyche
among Turks and Argentines in decades to come. Accordingly, political
parties were the most important institutions in the Turkish political
system. Therefore, Turkish workers might have seen political parties

as the main institutional decision-making hubs in dealing with priva-
tizations . When confronted with privatizations, they might have used
the institutional mechanisms ofinterest aggregation and representation
via political parties akin to their ideological and political affiliations.
Accordingly, it might have been easier for Turkish workers to envisage
and create a protest movement without their unions' support because
labor unions were never really the issue in Turkey. The more educated
and the more partisan the Turkish worker was, the easier it became for
him to engage in some sort of (collective) action against the negative
effects of privatizations.
In Argentina, on the other hand, labor unions have alwaysbeen one
of the most important and political organisms . Accordingly, it might
be the case that the Peronist nation-building project in Argentina
pushed Argentine workers, almost unconsciously, to turn to their
unions when confronted with privatizations. Given these conditions,
collective action devoid of union support might have been harder to
envisage in Argentina. This would explain why the level of educa-
tion and partisanship were not significant variables in determining
workers' attitudes vis-a-vis privatizations; unionismo was.
SOME IMPLICATIONS FOR FURTHER RESEARCH

It is an utterly complex task to pin down the direct and separate
effects of privatizations apart from the rest of the restructuring reforms
entailed by globalization. It is equally hard to conceptualize, operation-
alize, and measure democratization. This book attempts to overcome
these difficulties by focusing on labor unions and workers as important
actors of democratization and the most direct targets of privatizations.
By comparing labor institutions and individual workers affected by
privatizations in different degrees, and active in different sectors of
activity and across countries, a modest attempt is made to understand
the effects of globalization on democratization, The variety of research
methods used, including questionnaires, in-depth interviews, focus
groups, and descriptive statistics, attempt to find preliminary answers
to the question of the social and political impact of privatizations.
The findings of this study about the effects of privatizations on
democratization, however, stay as hypotheses at best. For starters, a view
ofdemocratization as institutional adaptation, based on the principles of
cooperation, autonomy, and stateness, and as individual activism based
on the principles of collective action and political participation is rather
limited. Democratization is also about political parties and elite politics
such that the acts and actions of labor union leaders can be more rel-
evant than the structures and workings of unions and the attitude and
behavior of workers. The assumption that democratization is inclusion
of local voluntary efforts independent from and along with centralized
and professionally managed institutions has shortcomings of its own .P
Second, although this study has done its outmost to include
workers from all spheres of society and life, a selection of focus group
participants based on their union affiliation and sectoral activity
can by no means allow for sweeping generalizations on the social
and political impact of privatizations in the global era. Relying on
networking and waiting in front of the previously privatized firms to
randomly request workers to participate in focus groups can inject
"science" into the selection process only to a certain degree . That
is why we cannot off the bat assume that the ways in which workers
have dealt with privatizations as outlined in this study are the only
and exlusive responses to privatizations in Turkey and Argentina. Nor
can we maintain that privatizations alone have been responsible for
the visible resemblance in the ways in which the Turkish and Argen -
tine unions have dealt with privatizations. The apparent tendencies
and links that this study has posited, therefore, purports to open the
way to further research on the social and political consequences of
neoliberal policies on targeted societal groups.
Third, the fact remains that economic globalization or neoliberal
structural adjustment plans cannot be reduced to privatizations alone .
Although studying privatizations as a proxy for economic globaliza-
tion implies a wider perspective than equating it with, say, McDon-
aldization (Ritzer 2004), everybody knows that globalization is so
much more than either a specific group of policies, like privatizations,
or the growth and reach of one multinational for that matter. In the
world of labor, globalization implies changes in the working condi-
tions, work rules, subcontracting, precarization of the workforce in
and outside the privatized state enterprises, and overall conditions in
international markets that have incited a plethora of labor responses
around the globe (Pion-Berlin and Epstein 2006) . The post-200l
crisis in Argentina has produced the piquetero movement and the
Asembleas Populares where workers have been active as vocifer-
ous critiques of neoliberalism. This study, however, in its targeted
focus on the effects of privatizations, and not the overall currents of
globalization, was unable to detect a link between these sporadic
movements and privatizations per se.
Fourth, different sectors of activity that have undergone priva-
tizations abide by different logics of implementation and dissimilar
constraints. As such, a sector-wide comparison suffers from similar

predicaments as those associated with a ceteris paribus assumption.
The same limitations dog the choice of ideological/rational and
unionsanshipjpartisanship criteria concerning the categorization of
worker responses to privatizations since the value spectra of workers
around the world are much more complicated and can involve various
other degrees and shades between such extremes . As Nancy Powers
(2001) concludes as a result of her in-depth interviews with about 40
residents of Buenos Aires, the Argentine people express their material
interests not in terms of their quantitative possessions and needs but
in terms of constraints on opportunities and constraints on choice
(11). But then again, Powers' study proves as impotent as this one
when it comes to making generalizations to the Argentines as a whole
based on a small-N study.
Finally, although the most different systems design generates
important findings about the convergent effects ofprivatizations at the
institutional level of analysis, a generalization to the developing world
based on two cases alone is problematic. But then again, what this
study attempts to do is not to generalize its findings to the developing
world but to delve into the explicit and implicit causal links between
privatizations and democratization. As such, while the sometimes not
so obvious causal linkages are unearthed from the personal accounts
and confessions of workers and union leaders, this study also hopes
to open a whole new avenue of research for students of development
and democratization regarding the posited links between the differ-
ential effects of privatizations and democratization.
What are the links that this study posits between privatizations and
democratization? The two general categories of potential links are (1)
the role ofprivatizations as an invisible hand ofdemocratization in the
case oflabor institutions and (2) the lack of any significant long-term
impact of privatizations on individual workers .P The comparative
analysis of the Argentine and the Turkish cases of privatizations and
labor developments has shown that privatizations are likely to con-
tribute to increased plurality, tolerance, openness, and autonomy of
the labor unions, leading some to demand democratization, directly
and explicitly, and for the very first time. The involvement of labor
unions in research and civil society activism-" as well as their adopting
a more professional attitude in their dealings with the government
and the private sector are some of the other mechanisms that seem to
link privatizations with democratization. Interestingly, unions acquire
these characteristics and engage in such activities, not only because
E F F ECTS 0 F PRIVATI ZATI 0 N SON LAB 0 R 207
of privatizations but against them. Privatizations, therefore, seem to

unintentionally produce democratization at the institutional level.
While privatizations and democratization are connected to one
another, parallel developments that suggest the reverse are also pres-
ent in Turkey and Argentina. This refers to the dominating power of
structural rules and legacies against change spurred on by privatiza-
tions. The fact that the pro-democracy CTA recently applied for the
personeria gremial, which it had long contested as an authoritarian
practice, is a good example . The continuing legacy of the "Father
State" in Turkey is another one . These continuous legacies and
practices show that the democratizing effects of privatizations on
labor institutions may not suffice to change decades long habits and
practices at one stroke.
It is important to detect and analyze the changes in labor insitu-
tions brought about by privatizations. It is, however, equally vital
to understand the individual worker responses to privatizations
and to listen to their voices (Ranis 1991). This study's finding that
privatizations do not necessarily elicit collective action or increased
participation on the part of individual workers in the long run,
underlines the importance of historical legacies in social and political
development. Accordingly, the Peronist and Kemalist nation-building
projects and their respective emphasis on labor unions and political
parties as the drivers of political change might have contributed to
the divergent short-term reactions of workers to privatizations in
these two countries.
As a final word of caution, there seems to be at least three caveats
for privatizations to positively contribute to democratization. One is
the condition that the institutional power of the unions not be cap-
tured by the personalistic rule of the union leaders . This means that
the increasing independence of labor unions as institutions should
not merely equal the rising power of individual union leaders in them.
Second is that the increased capacity and autonomy of the state, that
is, stateness, as result of privatizations does not translate into the
overly increased personal power of politicians . Third caveat for priva-
tizations to contribute to democratizations is for individual workers
and marginalized citizens to be effectively and gradually incorporated
into the sociopolitical system.
Clearly, privatizations are an important facet of economic globaliza-
tion and influence democratization in myriad ways in different parts of
the world . While this study has attempted to inject a modicum of order
to this brouhaha of links and consequences, it has also demonstrated
the validity of the dictum that democratization projects are ubiqui-

tously and consistently political. Only a few would disagree that the
Turkish process of democratization entails principally the project of
accession to the European Union, including above anything else an
improved record of human rights . Reciprocally, there is consensus
among scholars and practitioners alike that the Argentine process of
democratization mostly concerns the repudiation of military regimes
and the divulgence of crimes committed by them. That is why priva-
tizations are doomed to be the indirect and less significant factors in
democratization, but factors nevertheless in an ever-globalizing world .
NOTES
INTRODUCTION
1. Clearly, there is an endogenous relationship between privatizations
and democratization. This should not, however, preclude the analysis
of causality, given that endogeneity is clearly acknowledged. For more
on endogeneity, see Keohane, King, and Verba (1994) .
CHAPTER 1
1. This study focuses only on indu strial, service, and energy sectors,
thereby omitting less prevalent, more recent, and controversial
privatizations of social security, pension plans, education, and banks.
2. O'Donnell and Schmitter (1986 ) define liberalization as "the process
of making effective certain rights that protect both individuals and
social groups from arbitrar y or illegal acts committed by the state or
third partie s" (7) .
3. These scholars are transitology literature scholars, such as O'Donnell
and Schmitter (1986) and Przeworski (1995) .
4. Political open ing here means liberalization.
5. Con sulta Popular is a participatory tool whereby people living in a
town or district come together to decide on a vital political, economic,
or social issue that affects them all. See http://www.fmmeducacion.
com .ar/Historia/Cacerolazos/077consultapopular.htm
6. Asambleas Barriales refer to spontaneous groupings of members of a
community in village or city centers or in corners of streets to debate
the social and economic problems that afflict them. For more, see Bloj
(2004) .
7 . La Asociacion por una Tasa a las Transacciones Financieras y Ayuda
a los Ciudadanos is a movement that originated in France toward the
end of 1998. It fights against speculative global investment. For more
information, see http://www.argentina.attac.org/.
8. Dialogo 2000 is an interregional organization that works to cancel exter-
nal debt, eliminate poverty, and enforce human rights and peace. For
more information, see http ://www.dialog02000.org.ar/marcos1.htm
9. The World Social Forum was created to find an alternative road to
sustainable and equ itable development. It refutes neoliberal globaliza-
tion and provides an open platform for debate against the International
210 NOTES
Monetary Fund and the World Bank. For more, see http ://www.
forumsocialmundial .org.br/index.php?cd_language=2&id_menu=
10. See http://laborsta.ilo.org/cgi-bin/brokerv8.exe
11. Union density and unionization rates can also be used for compari-
son of worker and union activity in the pre- versus post-privatization
periods. The data on union membership across countries, however,
are hardly comparable since data collection methods and reliability
remain issues of concern. Union density has decreased consider-
ably in Argentina, from 65 percent in 1985 to 29 percent in 2007,
as opposed to a meager decline in Turkey, from 61.5 percent in
1985 to 58 .6 percent in 2008. (Data obtained from International
Labor Organization's World Labor Report 1997-1998 and the
respective sites of Labor and Social Security Ministry of Turkey and
Argentina .)
12. Focus groups entail observing the interaction and recording the
conversations of a specific group of people . The researcher asks one
or two specific questions and leaves the discussion to follow its own
course (Morgan 1997).
13. King, Keohane, and Verba (1994) argue that observations should
not be selected on the basis of the dependent variable (108-09)
since this practice might lead the researcher to pick only those cases
and values that prove her hypothesis. This guideline, borrowed
from statistical reasoning, was contested by other social scientists
such as McKeown (1999) and Collier and Mahoney (1996). These
and other scholars rejected the logical positivism adopted by King,
Keohane, and Verba (1994) and supported the opposite idea that
a lack of variance in the dependent variable does not inherently
pose a selection bias problem if the research objective is to capture
heterogeneous causal relations.
14. This approach is usually adopted by economists, including Jeffrey
Sachs (2005).
15. Sociological New Institutionalism focuses on the impact of norms,
cultural beliefs, and traditions on organizations and individuals. Fore
more, see Thelen (1999).
16. Some examples are to be found in Farazmand (2000), Birch and Haar
(2000), and Suleiman and Waterbury (1995).
17. There are various definitions and types of learning. Here learning is
defined as a process in which individual learning interacts with social
and political dynamics to become an important part ofan organization.
For more on learning theories, see Bennett (1999, 75-112).
18. Focus group with the Union of Metallurgy Workers (Union Obrera
Metalurgica, UOM) worker representatives in San Nicolas, Argentina,
June 2006.
19. Interviews with Dr. A. Monsalvo, lawyer of UOM, Buenos Aires,
Argentina, May 2006 and Jorge Sappia, the former minister of labor
of Cordoba, Cordoba, Argentina, July 2006.
NOTES 211
20. Interview with Mehmer Kilic, section leader of the Union of United
Metallurgy, affiliated to DISK. Bursa, Turkey, August 2005 .
21 . These are rich CGT leaders in banking, commerce, and energy sectors
in Argentina.
22 . Yellow un ionism refers to secretly cooperating with private employers
and the government. For more, see http ://www.emep .org/trade/
Brochure.html
23 . The voluntary retirement packages (Retiro Voluntario) consisted of
high sums of monetary compensation given to workers who were
dismissed as a result of privatizations. Although voluntary in name,
employers and the government used various tools of coercion, such
as psychological pressure , to make the workers leave.
24. This was not the case for the non-Peronist leftist workers affiliated to
the CTA and the CCc.
25 . The picketers (piqueteros) are unemployed protesters. For more,
see http :/ /www.americas.org/News/Features/200202_Argentina/
200202index.htm The cardboard collectors (cartoneros) are the
unemployed in Argentina who try to make a living by sorting through
the day's trash in search of recyclable material that can be exchanged
for money. For more information, see http :/ /www.worldpress.
org/photo_essays/cartoneros/cartoneros.htm Recuperated factories
(jabricas recuperadas) refer to those plants and workshops whose
private owners declare bankruptcy and leave the plant. Workers, who
then refuse to leave, continue with the production process . To learn
more, see http ://www.nodo50.org/ derechosparatodos/EmpRecu/
Home_empresas.htm
26 . Interview with the secretary of education and mobilization, Etgardo
Hollstein, UOM, San Nicolas, Argentina, June 2006.
CHAPTER 2
1. Parts of this chapter were taken from the unedited version of my
article published in the Journal of Turkish Studies by Taylor and
Francis. See Blind, Peride Kaleagasi. "A New Actor in Turkish
Democratization: Labor Unions," in Turkish Studies 8,2 (Fall 2007):
289-311.
2. New Institutionalism is an approach, which puts emphasis on the
independent and enduring effect of institutions on individual action.
See March and Olsen (1984) .
3. For more, see Sunar and Sayari (1986) .
4. For more on Ataturk's reforms, please see Renda and Kortepeter
(1986) .
5. Fore more on single-party rule in Turkey, see Ozbudun and Kazan-
cigil (1981).
6. For more on the multiparty system in Turkey, see Sayari (2002) .
7 . For more, see Sayari (2002) and Keyman and Onis (2007) .
212 NOTES
8. Although resembling a burgeoning aristocratic class, ayanscould never

establish private property on land . Ayanswere provincial notables who
had private armies of mercenaries and slaves, which they sometimes
lent to the palace as additional military force in return for recognition
of their autonomy by the sultan . For more, see Pamuk (2005).
9. While this categorization is necessary for analytical purposes, it is also
subjective. The 1980 military coup, for instance , also constitutes a
very important break in the history of labor developments.
10. In this system, peasants were not serfs nor were the "timarli sipahis"
the equivalent of landlords. Peasants never attended to the personal
needs and demands of the sipahis, nor were the latter entitled to any
portion of the peasants' produce.
11. Ahi means generosity and brotherhood in Ottoman. For more,
see Cagatay (1981) .
12. Tradit ional baggy trousers worn in the Middle East.
13. Some argue that the labor organization in question was founded in
1854. Others consider another labor organization called the Ottoman
Association of Friends of Workers (Osmanlt Ameleperver Cemiyeti,
OAC) to be the first. Nor is there consensus on whether the latter
was a union-like institution or a charity organization established by
intellectuals who cared about workers' problems. Still others claim
that it was a Marxist organization (Erdinc 2003, 73 ).
14. The DIU was composed of European and Ottoman politicians over-
seeing the collection of the external debt owed by the empire .
15. A nonmetallic element extracted chiefly from kernite and borax and
used in abrasives and hard metallic alloys.
16. The Young Turks can be considered as the first national entrepreneur-
ial class in the history of the Ottoman Empire. For more, see Mardin
(1983) .
17. Turkey declared war on Germany one day before the war ended.
18. This amounts to 84 cents in 2006 US dollar terms.
19. The CHP and the DP were not the only political parties of the 1950-
1960 era. The Socialist Workers and Farmers' Party of Turkey (Turkiye
Sosyalist Emekci ve Koylu Partisi, TSEKP) and the Socialist Party of
Turkey (Turkiye Sosyalist Partisi, TSP) helped establish countless unions
in this period . A few independent unions came together to form the first
Workers' Party (Isci Partisi, IP) in 1953 (Sulker 1987,118).
20 . Internal factors also played a role in the formation of TURK-IS, albeit
to a lesser degree . Rivalry between the CHP and the DP was important
in determining the emergence and evolution of the confederation later
on (Gungor 2002,173).
21. Information agency organized in 1947 composed of Communist
parties of Bulgaria, Czechoslovakia, France, Hungary, Italy, Poland,
Romania, the Soviet Union and Yugoslavia.
22 . The check-off system refers to the automatic deduction of union fees
from the paychecks of member workers.
NOTES 213
23 . The YHK had all the decision-making power for cases where col-
lective bargaining failed in workplaces. The YHK was composed of
three groups. The first group included a politician from the Ministry
of Labor and Social Security, an academic working group on labor or
economics and an independent judge . The second group comprised
two union representatives selected by the biggest confederation .
Finally, the third group was formed by two representatives selected
by the biggest employers confederation and two SOE representatives
selected by the Cabinet.
24 . A social democrat in the Turkish context refers to a person who
believes in democrac y and market economy while, at the same time,
working to embrace social welfare and justice as important elements
of the political system.
25 . The AP (1961-1980) was a political party founded in 1961 by the
DP 's lower echelons . After the 1980 military intervention, the AP
was dissolved. See http://www.bookrags .com/history/ worldhistory/
adalet-partisi-ema-Ol/
26. MISK and HAK-IS were perceived as possible alternatives to leftist
unionism, and thus, were easily acquitted. MISK gradually lost its
members to TURK-IS and was dissolved in 1988 . HAK-IS became
the second largest confederation of the country after the coup due
largely to the banning of DISK (Genis 2002) . DISK union leaders
had to wait for a 1991 decision of the military Supreme Court of
Appeal (Ya1LJztay) to be acquitted .
27 . This clause was canceled in 1986 when the state of siege was lifted
(ibid .).
28 . This clause was changed to "currently working" in 1988 (ibid.).
29 . The maximum of four consecutive terms for the secretary-general was
changed to eight terms in 1988 (ibid .).
30. In 1988, it was added that in order for a transfer of property to take
place, prior consent from the General Assembly of the union in que s-
tion should be obtained (ibid .).
31. A change in law no . 2822 in 1986 made the 10 percent requirement
more anti-democratic. If a union was under the threshold, it was
banned from rejecting or que stion ing other unions' applications for
representation (ibid .).
32 . Turkey introduced an extensive package of Constitutional changes in
September 2001, including but not restricted to the areas of freedom
of expression and association. These and other liberalization efforts
toward joining the European Union have also benefited the democratic
development of the labor movement . See Beris and Gurkan (2001).
33 . Despite significant advances on union freedoms, Parliament was unable
to ratify the ILO Convention no . 158 due to the lack of unanimity.
Contradictions between the 1982 union laws (no. 2821 and 2822)
and the ratified ILO Convention no . 87, the Liberty of Unions and
Protection of the Right to Unionize, stayed. These contradictions
214 NOTES
referred to the banning of union offices in workplaces, the requ ire-

ment that union leaders be de facto workers for ten years and never
arrested for participating in strikes, the banning of union activities
deemed to be political, the double thre shold system for collective
bargaining and the transfer of union property to the Treasury upon
closure.
34. The Peace and Democracy Platform is a civil society initiative formed
by a group of intellectuals having a common beliefin democratic values
and peace. See http ://www.evrensel.net/02/09/25/sendika.htrnl
35 . Additional research is needed on the question of why these two years
deviate from the general pattern. Since 2001 and 2002 coincide
with the peak of privatizations, the relationship between the latter
and collective agreement making constitutes a research project on its
own.
CHAPTER 3
1. Caudilloswere owners of large estates who rose to power once they
assembled gaucho armies. Gauchos were cattle herders, similar to
North American cowboys. See Lynch (2001).
2. Capitulations were economic and administrative rights and privileges
accorded to Europeans on a unilateral basis.
3. While this categorization is necessary for didactic and analytical pur-
poses, it is also arbitrary. The 1976 military coup, for instance, also
constitutes an important milestone in the history of the Argentine
labor movement.
4 . Estancieros were owners of large estates.
5. For more, see Diaz (1999) http://www.po.org.ar/po/p0616/
a80aosde.htm and Godio (1972) .
6. The Communist Party was formed in 1918 and disappeared by the
1930s (Di Tella 2003).
7. Not all unions were protected by Peron . The Argentine Confed -
eration of Catholic Workers (Confederacion Catolica de Trabajadores
At;gentinos) went out of existence during Peron's reign for not
following his lead (McGuire 1995).
8. Argentine Presidential Palace and the heart of the executive power.
9. Some authors have described the Argentine labor movement as a vari-
ant of societal corporatism. See Acuna (1995) for such an account .
Others have characterized it as statist and less than democratic. For
such an account, see Goldin (2001) .
10. Other sources of funds for unions were membership dues deducted
automatically from workers' paychecks by employers and paid directly
to the unions' national headquarters , direct contributions to the
national headquarters of a certain amount of the wage increases
obtained in national collective agreements, and servicesrun by unions,
such as vacation resorts and special medical facilities (Munck 1987) .
NOTES 215
11. The PAP was a strategy of survival that signified maintaining friendly
relations with the governing party or coalition of parties, regardless
of the latter's political leanings, democratic character, or workers'
interests. See Chapter 2 for more on PAP.
12. Both organizations were named after the streets on which their
respective headquarters were located in Buenos Aires.
13. The Montoneros were a group ofPeronist students founded in 1955
and implicated in the assassination of the military personnel and
the union leaders who cooperated with the military. For more, see
Novaro 2006.
14. The Malvinas Islands in the South Atlantic have been a British ter-
ritory for more than 150 years; the Argentines have disputed British
sovereignty. See Kanaf (1982) .
15. Alfonsin's labor reforms included measures such as the introduction
of proportional representation in union elections and a reversal of
the top-down union electoral processes such that elections would
first take place in shop committees, then extend all the way up to
the union and CGT executive leaders. Alfonsin also envisaged treat-
ing certain socioeconomic questions as matters of utmost urgency
and crisis, so that the government could have complete power of
legislation over those areas. The reform package was defeated in the
Peronist-controlled Senate (McAdam, Sukup and Katiz 1999).
16. Personal Interview with Dr. Osvaldo Battistini. CONICET June 1,
2006, Buenos Aires.
17. Personal Interview with Gabriel Martinez, secretary of public rela-
tions, Federation of Workers of Energy of the Republic of Argentina
(Federacion de los Trabajadores de la Ener;gia de la RepublicaAr;gentina,
FETERA). June 2, 2006, Buenos Aires.
18. Salariazo was Menem's campaign promise that all wages would be
increased .
19. The scope and extent of social services administered and provided
by unions were also reduced starting in 1998 . In 1996, there were
300 national social works (obras sociales) of which 200 were union
provided, covering 22.8 percent of the population. The decrease in
the number of affiliates also correlated with the decline in union-
provided social services since worker contributions decreased alongside
the wages (Novick 2001,34).
20 . This refers to contracted workers who are not members of any union .
21. With the reform of the social security system in Argentina, employ-
ees could now elect to remain in the old allocations system or have
their contributions, equal to 11 percent of their salary, deposited and
managed by private funds known as Retirement and Pension Fund
Administrators (Administradoras de fondos de jubilaciones y pensiones,
AFJPs). For more, see (Demarco and Maciel 1996).
22 . Interview with the secretary-general ofthe Union of RailwayWorkers,
Jose A. Pedraza . June 2, 2006, Buenos Aires.
216 NOTES
CHAPTER 4
1. Parts of this chapter were taken from the unedited version ofmy article
published in the Journal of Turkish Studies by Taylor and Francis. See
Blind, Peride Kaleagasi. "A New Actor in Turkish Democratization:
Labor Unions," in Turkish Studies 8,2 (Fall 2007): 289-311.
2. For more on the economic reforms in the early Republican period,
see Barkey (1992) .
3. Some scholars argue that statism is not, and has never been, an
entrenched ideology in Turkey. For such an account, see Patton
(1992) . Others maintain that the statist mentality was one of the deter-
mining factors in the sluggish pace of privatizations in the 1990s . For
more, sec Shaker (1995) .
4 . Economic restructuring was not the only item in the agenda of the
military. More important were the elimination of old political loyalties
and extremist groups. See Nas and Odekon (1988, 1992).
5. In this regard, Eder (2003) went as far to argue that Turkey evolved
toward a corporatist system where business and labor representatives
would occasionally meet to discuss the needed reforms. It should be
remembered, however, that this consultative experience refers to a
very brief period in the history of the Turkish privatizations.
6. For more, see http://www.oib .gov.tr/baskanlik/yasal_cerceve.htm
7. While this is the opposite objective of the Argentine privatizations,
it would not be too long before revenue generation becomes the
primary objective in Turke y as well.
8. Privatizations really started with a trial case in 1986 with the issuing
of the Revenue Sharing Certificates for the Bosphorous Bridge con -
necting the European to the Asian Continent, and the Keban and
Oymapmar Dams. The method of Revenue Sharing Certificates was
chosen to learn. about the public stand toward privatizations and to
attract the support of middle class by involving them in the process
and turning them into share owners . The results showed that the
Turkish public was in favor of privatizations.
9. The SPO develops and manages the investment programs of the state.
For more , see http://www.dpt.gov.tr/dptweb/turkin.html
10. Decree making considerable fastened the implementation of priva-
tizations . As a result, the privatization of electricity sector was com -
pleted in three months while that of the gas sector took less than
five months. Decree making did not have the same effect in the
privatization of the social security system, however , due to the more
conflictual nature of this project. For more, see Alonso (1998) .
11. The law prepared the legal ground for the implementation of
privatizations. It expanded the scope of the SOEs to be privatized.
It established the Privatization High Council and Privatizations
Administration to centralize the process. It allowed those workers
subject to civilservants law 657 to be transferred to other government
NO TES 217
institutions following privatizations . It also initiated a severance pack-

age for the workers working under temporary service contracts and
covered under labor law 1475 , which was replaced with labor 4857
in 2003 (Yildiz 2002 ).
12. Economic neopopulism is when the government is able to maintain
its monetary base and reserve levels as required by law, as it simultane-
ously increases public spending. For more on economic neopopulism,
see Palermo (1998 ).
13. Detailed interviewee list can be obtained from the author upon
demand (peride@yahoo.com ).
14 . Confid ential personal interview. Istanbul: Augu st 15,2006.
15. Despite significantadvancesin union freedoms, the coalition government
was not entirely successful in its democratization program. The ILO
Convention no . 158 on job security was returned to the Parliament by
the President . The Parliament was unable to ratify it due to a lack of
unanimity. Contradictions between the 1982 union laws (no. 2821 and
no . 2822) and the ratified ILO Convention no . 87 on the Liberty of
Unions and the Protection of the Right to Union ize remained .
16. Person al interview with Salih Kilic, secretary-general of TURK-IS.
Istanbul, August 2005.
17. Personal int erview with Tugrul Kudatgobilik, the secretary-general
of the Turkish Employers Confederation (Tu rkiye Isveren Sendika -
lari Konfed erasyonu, TISK) and the secretar y-general of the Turkish
Metal Industrialists Un ion (Turkiye Metal Sanayicileri Sendikasi,
MESS). Istanbul, August 2005 .
18. Salih Kilic, secretary-general of TURK-IS, refers to emplo yers as the
" mother," and unions, as the 'father' of workers (T ISK 1995, 69 ).
19. CGT-San Mart in in Argentina and its subgroup, the Movement
of Argent ine Workers (Movimiento de los Trabajado res Argentinos,
MTA), have also adopted similar strategies.
20 . The Turkish left-wing daily Evrensel defines "yellow unionism" as
a type of union strategy whereby union leaders get into a close and
dependent relationship with emplo yers.
21. Personal interview with Suleyman Celebi, secretar y-gene ral of DISK.
Istanbul, Augu st 2005 .
22. HAK-IS' format ion in 1991 coincides with the implementation of
privatizations .
23 . The success of the privatization of Kardemir is debatable . Some
scholars see it as a success story, pointing out the modernization of its
technology and profitab ility (Bakan, Erarslan and Sarac 2002). Others
draw attention to the continuing subsidies from the state for ensuring
the survival of the company (Yilmaz 2005).
24 . The dom ination of the media by large national private owners, who
were also active partic ipants in the privatizations, might have had a
role in media 's reactions against the involvement of labor unions in
privatization s.
218 NOTES
25. The practice oftransferring workers downsized asresult ofprivatizations

to government agencies around the country has meant a busy traffic
of migration from region to region and city to city in Turkey. This has
created problems of social and cultural adjustment.
26. Personal Interview with Osman Yildiz, advisor to the secretary-
general ofHAK-IS. Ankara, August 2005 . This is similar to the labor
university project of UOM in San Nicolas, Argentina. The Federa-
tion of Light and Power (FATLyF), active in the energy sector in
Argentina, already has a labor university where workers and others
can attend for training in union management and other labor-related
matters. Personal interview with Hugo Giarelli, secretary of funds and
finances ofFATLyF. Buenos Aires, June 2003.
27 . Personal interview with Mustafa Oztaskin. secretary-general of the
Union of Petroleum Workers (Petrol-Is) Istanbul, August 2005 .
28 . The Platform was revived in 2000 under the name of Platform of
Labor (Emek Platformu) .
29 . Labor Force Questionnaire can be provided by the author upon
demand . The qualitative methodology of nonrandom sampling is
appropriate for the research question of this study because I expect
the responses of workers to privatizations to be strongly correlated
with their labor confederation affiliation. That is why I chose the
focus groups on the basis of (1) labor confederation affiliation and
(2) impact of privatizations. Accordingly, the four out of five sectors
comprised by focus groups, namely, the petroleum, maritime, cellulose,
and tobacco sectors, were largely influenced by privatizations. The
control group of automotive sector was not. Three out of five focus
groups came from the largest labor confederation in Turkey, TURK-IS,
one from HAK- IS, and one from D SK. Contact information of
workers was obtained from the unions, academics, and civil society
representatives .
30. The third question was asked only if the group seemed to drift away
from the topic.
31. City in Western Turkey.
32 . With a change made to the civil servants law 657 in 2001, blue-collar
workers who lost their jobs as a result of privatizations could be trans-
ferred to public institutions under the status of "temporary workers"
and employed at a minimum wage and for only ten paid months.
They could not be union members and had two months of unpaid
vacation.
33 . This style of negotiation can also partly be explained by their edu-
cational level: they were both high school graduates while the more
erudite and civic-minded Unver from the Ministry of Health in
Ankara or Kadir from the General Directorate of State Hydraulic
Works in Istanbul were university graduates.
34. Membership in the OM movement ranges anywhere from 500 to
1,000. It is not a formal and institutionalized movement, this making
NOTES 219
its adherents free to leave and join when they want. The nucleus
of the movement is composed of representatives in every city, who
mobilize the victims of privatizations in their own area . There are
20 to 30 representatives. Personal interview with the leader of the
movement, Unver Uyar (Ankara, August 2005) .
35 . DISK was a supporter from the very beginning, but the support was
symbolic since DISK is a labor confederation that is institutionalized
in the private sector only.
36 . The OM members also made full and effective use of the media to
disseminate their cause. They participated in television programs such
as Hayata Balas (in the episode called Sermaye ps. Sinij, or Capital ps.
Class) by Ferhan Saycleman on Flash TV, Teke Tek on ATV by Fatih
A1tayli, and Soz Meclisi on Kanal Turk by Tuncay Ozkan.
37 . For more, see http://www.evrensel.net/06/07/16/sendika.html#1
38. TEKEL's alcohol section was privatized in November 2001 by a
block sale of 100% of shares for US$ 292 million to the Nurol-
Ozaltin-Limak-Tutsab Consortium. The Tekel cigarette tender was
cancelled by the tender commission. See http://www.oib.gov.tr/
portfoy/tekcl_eng.htm
39 . Kidem tazminati is the compensation money that must be given
to workers who are laid off by an employer. The worker has to be
employed for at least one year to have the right to receive the KT.
For each year worked, the worker receives a monthly salary that cor-
responds to his highest monthly salary. For more, see http://www.
alomaliye.com/bilgi_kidem_tazminati.htm
40 . This strategy should be taken with a grain of salt since it is hard to gen-
eralize to the whole population based on what one focus group did .
41. The other reason for the lack of impact of privatizations on voting
decisions is also that there are not really explicitly anti-privatization
parties left in the Turkish political scene . Onis (2000) argues that since
the 1990s, there has been a strong convergence on privatizations by
political parties regardless of their political leanings or constituents'
stands (303) .
CHAPTER 5
1. Capacity of the state to specify the terms of economic interaction,
to extract resources, and to centralize administrative procedures and
coercive means . See Schamis 2002, 192 .
2 . As opposed to the French system, the US model takes neoliberal
restructuring and privatizations as its main pillars and views public
utilities as private industries subject to intensive regulation by the state.
The operation of utilities, therefore, does not constitute a bastion of
government as it does in the French model (MairaI1996) .
3. A divided government happens when the presidency and the Congress
are controlled by two different parties opposed to each other. In extreme
220 NOTES
cases, a divided government can lead to gridlock between these two

institutions . For more, see Mainwaring and Shugart (1997) .
4. Latin American hyperinflations do not happen all of a sudden but usu-
ally come about as a result of gradually increasing inflation rates. Latin
American governments are also unique in that they can still collect taxes
during the hyperinflationary periods (Kiguel and Liviathan 1995).
5. Margheritis (2000), as opposed to Galiani and Petrecolla (2000),
divides the Argentine privatization experience of the 1990s into two
distinct phases. The first stage starts with Menem's accession to power
in 1989 and ends in 1992 with the completion of the privatization of
EnTei and Aerolineas Argentinas . The privatizations of the television
and radio channel s, the railway system, petrochemical companies and
oil pertain to the second phase, which also coincides with the final
stage of Menem's political term .
6. The community in question includes both the so-called captains of
industry and multinationals. For more, see Gerchunoff (1992) .
7. Personal interview with the engineer Elido Veschi, secretary-general
of the Association of Argentine Railway Managers (Asociacion de
Personal de Direccion de los PerrocarrilesAtlJentinos, APDFA) . Buenos
Aires, May 2006.
8. "All lines that go on strike will be closed." My own translation.
Menem said this in November of 1989 in a television program. See
Clarin . Argentine Daily. May 25 , 1997. http://www.clarin.com/
diario/1997/05/25/i-01602e .htm
9. During the first five years of the concession, the amount of promised
but not executed investments equaled almost 700 million dollars. See
Azpiazu 2003, p. 137 .
10. This refers to the state regulatory mechanism created for the purposes
of monitoring and ensuring the compliance of the private firms with
the clauses of privatization contracts.
11. During the Galaraport privatization, the Turkish minister of finance,
Kemal Unakitan, was accused of making private negotiations with the
Ozer family. Cern Uzan, another Turkish politician, was also said to
be illegitimately involved in the public tender for the sale of Telsim,
one of the GSM companies in Turkey. For more, see "Corruption
Report on Turkey" at http://www.saydamlik.org/engcorreport.htm
(June 2005-June 2006).
12. Ozal used discretionary funds to include traditional patronage politics
in the implementation of privatizations. The recipients were mostly the
potential losers of the restructuring. For more , see Waterbury (1992) .
13. Menem started the road to privatizations by putting in place emer-
gency measures such as currency devaluation and an increase in
taxation , as well as a strong program of structural reforms aiming at
the elimination of the fiscal deficit. These were identical to strategies
employed by the Demirel government in 1991, which succeeded
Ozal's administration in Turkey. For more, see Onis (2004) .
NOTES 221
14. Detailed interviewee list can be obtained from the author upon
demand (peride@yahoo.com) .
15. The law in question sought to change the winner-take-all quality
of the electoral system in place for the selection of union leaders
in Argentina. It proposed the adoption of proportional representa-
tion to open the Peronist power blocks to minority Radical groups
or others. Antonio Mucci was the Minister of Labor in Alfonsin's
government.
16. This refers to the problem of clearly delineating the sector, and there-
fore the union, of Argentine workers who were outsourced during
and after privatizations. For more, see http://www.oit.org .pe/sindij
ceacr/arg/c98/obs9.html
17. While workers' strikes based on the encuadramiento problem were
organized without their official unions' backing, they were welcomed
by the potentially receiving union. Furthermore, such protests were
often sporadic and limited in scope . As such, they did not include the
characteristics of a social movement in the general sense of the term, as
did the OM in Turkey and the ON, to a certain extent, in Argentina.
18. See La Flota Historica de YPF at http://www.flotaypf.com.ar/notas.
htm
19. This refers to pre-fixed percentages of shares transferred to the workers
of the privatized firms.
20 . Personal interview with Hugo Giarelli, secretary of funds and finances
ofFATLyF. Buenos Aires: June 2003 .
21 . There are differences among the worker members of the dissident
telecommunications sector union, Foetra-BA, depending on whether
they work for Telecom or Telefonica. Accordingly, workers employed
in Telefonica are much more radical and anti-privatization than
those working for Telecom . One reason for this difference might be
that there are more leftist floor representatives in Telefonica than in
Telecom . However, this can also be the consequence of the general
attitude of the respective rank and file (Garro 2007).
22. Personal interview with Fabio Basteiro, secretary-general of the capital
Buenos Aires Union of CTA. Buenos Aires, July 2006.
23 . Burzaco is the name of a city in the Buenos Aires province .
24 . Foetra-BA is formally affiliated with the CGT but is considered to be
closely associated with the CTA.
25 . Personal interview with Silvia Garro. Instructor of labor relations at
the University of Buenos Aires. Buenos Aires, July 2006.
26. This is equal to a little more than US 25 cents in 2006 prices.
27 . Personal interview with Roberto Izquierdo, professor of labor law at
the University of Buenos Aires and former secretary of labor under
President Menem. Buenos Aires, April 2006.
28 . For more on CTA-affiliated research and civil society organizations,
see http://www.ief.redcta.org .ar/spip.php?rubrique25 . For more on
ACTA, see http ://www.agenciacta.org.ar/
222 NOTES
29 . Ironically, however, the CTA applied for personeriagremial in 2005 .

According to Goldin (2006), this was a clear proof of the victory of
the "establishment" over a possible "renovation" in the labor move-
ment, and therefore, the lack of force of the privatizations, or any
other parameter for that matter, on transforming the paternalistic/c1ie
ntelistic nature ofthe system. In 2007, however, the CTA has gathered
enough national and international support to push the International
Labor Organization (ILO) to ask the Argentine government to grant
the CTA the personeriagremial (Goldin 2007).
30. Personal interview with Fernando Ledesma. The secretary of organi-
zation for the CTA. Mar del Plata, August 2006.
31. Personal interview with Sebastien Etchemendy. Professor of political
science, University of Torcuato di Tella. Buenos Aires, July 2006.
32. Arqentinazo refers to worker protest movements and the sacking of
the supermarkets following the economic crisis in December 2001.
33 . See www.cccargentina .org .ar
34 . See Argentina Unions at http://www.mundodeltrabajo.org.ar/
english/linkseng.htm#Sindicatos
35. Luis d'Elfa was the leader of the popular movement of the unem-
ployed called the Federation of Land and Dwelling (Federacion de
Tierra y Vivienda, FTV).
36. Personal interview with Jose Pedraza, Secretary-general of the
Railways Union (Union Ferroviaria, UF) . Buenos Aires: June 2006.
37. Personal Interview with Leticia Pogliaghi. Instructor of labor rela-
tions at the University of Buenos Aires. Buenos Aires, June 2006.
38. Transportation-related jobs were outsourced in almost all sectors that
underwent privatizations .
39. The MTA can also be categorized as a business union, due to
Moyano's recent involvement in the privatization of the Belgrano
Railways. Personal interview with Jose Pedraza . Secretary-general of
the Railways Union (Union Ferroviaria). Buenos Aires, June 2006.
40 . Email communication with Alvaro Orsatti, ORIT-CIOSL. New York:
April 28, 2007.
41. Personal interview with Osvaldo Castelnuovo. Secretary-general of
the Telephone Unions Federat ion. Buenos Aires, May 2006.
42 . Personal interview with Jose Pedraza. Secretary-general of the
Railways Union. Buenos Aires, June 2006.
43 . Personal interview with Victor Paulon . Secretary-general of UOM of
Villa Constitucion. San Nicolas, June 2006.
44 . This refers to prefixed rates of shares accorded to the workers of an
SOE to be privatized. PPPs were an integral and an important part of
privatizations in Argentina .
45. See http ://www.upcnsfe.org.ar/upcn_ingles/rodriguez_message.htm
46 . Personal interview with Roberto Julio Depetris . Advisor to the second
vice president of the Official Postal Service of Argentina . Buenos
Aires, May 2006.
NOTES 223
47. The city center, libraries, a health clinic, a stadium, an elementary and
a high school built by the UOM were glaring proofs of the import ant
role played by the union in San Nicolas.
48. Before the privatizations , many state-owned ent erprises hired new
personnel through these "work pools" called bolsas de trabajo
coordinated by the unions . The hiring proce ss was based on family
connections. Workers whose fathers or others family members were
former employees of the state firm had priority in being hired in the
privatized company.
49 . Th is is a chewy, lightly sweetened bread .
50 . Ages and education levels of focus group participants were similar,
between their 40s and mid-60s.
51. There were no female workers in this sample.
52 . When FOETRA-BA took an anti-privatiz ation attitude as opposed to
the leading union FO ETRA in the sector, the remaining collabora-
tion ists assembled to form SOEECIT, which does not have personeria
gremial due to its smaller number of affiliates.
53 . Personal interview with Carlos Ruggiero . Floor representative at FOE-
TRA-BA and employed in Telecom. Buenos Aires, August 2006.
54. Mate is the national drink of Argentina. It symbol izes solidarity and
trust. The same cup and straw are used by everybod y in a group.
Refusing to do so might be seen as impolite .
CHAPTER 6
1. See Dinavo (1995), Buttle (1996), Kurtz, Cunningham, and Adwan
(2001 ).
2. See Suleiman and Waterbury (1995 ); Birch and Haar (2000) .
3. Etem Erol, historian and lecturer Turkish Language Section at Colum-
bia University. Panel "Meaning of Turkishne ss and Democratization,"
at the 8th Annual Convention of the Association for the Studie s of
Nationalities. New York: Columbia Un iversity, 10-14 April 2008 .
4 . The change in question has been more apparent in the case of Turkey
with HAK-IS taking a much more explicit and active prodemocrati-
zation attitude than the business unions within the CGT. However,
the rhet oric of democratization has been apparent in the discourse of
the business unions in Argentina as well. For more, see Chapter 5.
5. Corporatism is defined as a system of intere st representation for
linking the associationally organized interests of civil society with the
decisional structures of the state . Societal corporatism is found in
political systems with relatively open and competitive electoral pro -
cesses, and party systems and coalitions across different ideologies.
State corporatism, on the other hand, is a political system in which
election s are nonex istent or plebiscitary, party systems are dominated
or monopolized, and execut ive authorities are ideologically exclusive
(Schmitte r 1986, 22 ).
224 NOTES
6. For poverty rates in Argentina and Turkey see, respectively, http://

web .worldbank.org/WBSITE/EXTERNAL/COUNTRIES/
LACEXT/ARGENTINA and http://www.tuik.gov.tr/PreTablo.
do?tb_id=23&tb_adi=Yoksulluk
7. It was estimated that the number of the unemployed in Turkey was
2,498,000, and the rate of unemployment 10.3 percent in 2004. See
http://www.byegm.gov.tr/yAYINLARIMIZ/kitaplar/turkey2005/
content/english/368-369.htm. Argentina's rate of unemployment was
also 10.4 percent in 2006 . See https://www.cia.gov/cia/publications/
factbook/print/ar.html However, this rate did not include workers
who were looking for a job or those employed in the informal sector.
The actual unemployment rate in Argentina was calculated to be
between 20 and 25 percent in 2002 . See http :/ /www.oit.org.pe/
engl ish/260ameri/publ/panorama/2002/textos2_decencwork_
deficit risesz.pdf
8. Th is finding should be taken with a grain of salt since it is based on
the outcome of one focus group only.
9 . Outsourcing (Taseron, in Turkish) was most prevalent in the sector of
construction in Turkey. 17.1 percent of workers employed the public
sector were outsourced in Turkey, as opposed to the 7.9 percent of
workers employed in the private sector (Mahirogullari 2005, 369) .
In Argentina, more than one-third of 5.866 .208 wage earners and
of2 .123 .170 unemployed workers who were looking for a job were
outsourced as of 1998 . See Molina (1999) .
10. The exact timing for the emergence of Kemalism as an ideology was
debated among scholars. While the question ofwhen and how Kemalism
as an ideology emerged constitutes a separate research endeavor, for
all intents and purposes, this study assumes that its seeds were sown
in the 1920s with Mustafa Kemal Ataturk's coming to power.
11. The six principles are Republicanism, Nationalism, Secularism,Statism,
Populism, and Reformism.
12. See Skocpol (2003) and Tilly (2007 ) for similar conceptions of
democratization.
13. The 2008 uprisings of Argentina's rural landholders and farmers have
also taken place devoid of union participation. It should be noted that
these uprisings are irrelevant for the scope of analysis adopted by this
study since agriculture as a sector was not affected by privatizations in
Argentina .
14. Civil society activism here means more than protest movements .
Union-originating protests have gone from 54 percent in the 1990s
to 31 percent by 2003 . Even then, union s have been active par-
ticipants of protest movements originated by nonunion actors (For
more, see Schuester et al. 2006). In the Argentine case, the formation
and workings of the CTA itself is a proof of the increasing conver-
gence of labor and civil society activism.
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"WSF" World Social Forum. http://www.wsfindia.org/whoweare.php Accessed

12/06/06. Accessed September 2006.
Yacimientos Petroliferos Fiscales. "La Flota Historica de YPF http://www.
flotaypf.corn .arynotas.htm. Accessed January 2007.
Yildiz, Hakan. Vice president, Privatizations Administration (01). "Social
Dimension Of Privatizations in Turkey: Employment and Labor Adjustment
Policies" Powerpoint presentation in OECD Meeting, Istanbul: 10-11 Octo-
ber, 2002 . Found at http://www.oecd.org/dataoecd/9/43/2482104.ppt.
Accessed 11/16/2005.
Zibechi, Raul. "El retorno de la Argentina plebeya," in La Insignia Iberoamer-
ica. Uruguay, December 2001. http://web.woridbank.orgjWBSITE/
EXTERNAL/COUNTRIES/LACEXT/ARGENTINAEXTNO"menuP
K:316034-pagePK:141132-piPK:1411 07 -theSitePK:316024,00.html.
INTERVIEWS
Personal interview with Adrian Goldin, professor of law and political science
at the University of San Andres . Buenos Aires: June 2006.
Phone interview with Adrian Goldin, professor of law and political science at
the University of San Andres . Buenos Aires: July 2007.
Personal Interview with Ana Maria Sacchi, member of the board of FETERA
and the secretary-general of the movement Black Gold (Oro Negro) .
Buenos Aires: June 2006.
Personal interview with A Monsalvo, lawyer of Union of Metallurgy Workers
(UOM) . Buenos Aires: May 2006.
Personal interview with Andres Rodriguez, secretary-general of the Union of
Argentine Civil Employees of State (Union Personal Civil de la Nacion,
UPCN). Buenos Aires: July 2003 .
Personal interview with Ayfer Yilmaz, director of Public Administration
Development Center-Foundation (KIGEM). Ankara: August 2005.
Personal interview with Carlos Rossi, vice president of the renationalized
official postal service of Argentina (Correo Oftcial Ai;!Jentino). Buenos
Aires: August 2006.
Personal Interview with Ing. Elido Veschi, secretary-general of Association of
Managing Personnel ofArgentine Railways (Asociacion de Personal de Direc-
cion de los Ferrocarriles Ai;!Jentinos, APDFA). Buenos Aires: May 2006.
Personal interview with Emre Kocaoglu, former TURK-IS representative,
former national deputy and the current director of the Turkish Association
of Democracy. Istanbul: August 2006.
Personal interview with Fabio Basteiro, secretary-general of the Confedera-
tion of Argentine Workers (Confederacion de los Trabajadores Ai;!Jentinos,
CTA) of Buenos Aries. Buenos Aires: July 2006.
Personal interview with Faruk Buyukkucak , secretary of the TURK-IS First
Region Federation. Istanbul: August 2005 .
Personal interview with Fernando Ledesma, secretary of organization of
Light and Power (Luz y Fuerza) Mar del Plata: August 2006.
250 BIBLIOGRAPHY
Personal interview with Gabriel Martinez, secretary of mobilization of the

Federation of Energy Workers of the Republic of Argentina (Federacion
de Trabajadores de la EnC1;gia de la Republica At;gentina, FETERA)
affiliated to the Center of Argentine Workers (Central de los Trabajadores
At;gentinos, CTA). Buenos Aires: June 2006.
Personal interview with Dr. Hector Garcia, legal counselor to CTA. Buenos
Aires: August 2006.
Personal interview with Dr. Horacio Meguira, legal advisor to the CTA.
Personal interview with interview with Hugo Giarelli, secretary of funds and
finances ofFATLyF. Buenos Aires: June 2003 .
Personal interview with Jorge Beneitez, secretary of public relations of the
Un ion ofWorkers,Specialists and Employees ofTelecommunication Services
and Industry (Sindicato de Obreros, Especialistas y Empleados de losServicios e
Industria de las Telecomunicaciones, SOEESIT) . Buenos Aires: July 2006 .
Personal interview with Jorge Gustavo Simeonoff, the executive secretary
for the renegotiation and analysis of the public service contracts in the
Ministry of Economy in Argent ina. Buenos Aires: August 2006.
Personal interview with Jorge Sappia, the former minister of labor of
Cordoba. Cordoba: July 2006.
Personal interview with Jose Angel Pedraza, secretary-general of the Union
of Railway Workers ( Union Ferroviaria, UF). Buenos Aires: May 2006.
Personal interview with Marcela Natalicchio, PhD Political Science, MIT.
Washington D.C.: October 2005 .
Personal interview with Jose Miguel Del Giudice, secretary-general of the
Cordoba section of the Federation of Workers of Postal and Telecommu-
nication Sectors (FOECYT). Cordoba: July 2006.
Personal interview with Leticia Pogliaghi, instructor of labor relations at the
University of Buenos Aires. Buenos Aires: June 2006.
Personal interview with Maria Del Carmen Framil, coordinator of training
at the Technological Institute of Leopoldo Marechal of the Union of
Sanitary Workers of Grand Buenos Aires (Sindicato G.B.A de Traba-
jadores de Obras Sanitarias). Buenos Aires: June 2006.
Personal Interview with Mehmet Kilic, section leader of the Union of United
Metallurgy, affiliated to DISK. Bursa: August 2005 .
Personal interview with Mustafa Oztaskin, secretary-general of Union of
Petroleum Workers (Petrol-is). Istanbul: August 2005 .
Personal interview with Oscar Lescano, secretary-general of the Union of
Light and Power in capital Buenos Aires. Buenos Aires: June 2006.
Personal interview with Osman Yildiz, senior advisor to the secretary-general
ofHAK-IS. Ankara: August 2005 .
Personal interview with Osvaldo Castelnuovo, secretary-general of the
Telephone Unions Federation (Federaci6n de Obreros, Especialistas y
Empleados de losServicios e Industria de las Comunicaciones de la Republica
At;gentina) FOEESITRA). Buenos Aires: May 2006.
BIBLIOGRAPHY 251
Personal interview with Dr. Osvaldo Ruben Battistini, Ceil-Piette Conicet.

Personal interview with Rodrigo Perez Graziano, chief economist at the
Argentine Chamber of Commerce (Camara A1l/entina de Comercio).
Buenos Aires: August 2006.
Personal interview with Dr. Roberto Izquierdo, professor of labor law at the
University of Buenos Aires and former minister of labor. Buenos Aires:
April 2006.
Personal interview with Roberto Julio Dcpetris, advisor to the second vice presi-
dent of the Official Postal Service of Argentina. Buenos Aires: May 2006.
Personal interview with Santiago Senen Gonzalez, journalist and labor
specialist. Buenos Aires: May 2006.
Personal interview with Sebastien Etchemendy, professor of political science
at the University ofTorcuato di Tella. Buenos Aires: July 2006.
Personal interview with Silvia Garro, instructor of labor relations at the
University of Buenos Aires. Buenos Aires: July 2006.
Personal interview with Taskm Gundag, secretary ofeducation and mobilization
for the Union of Food Sector Workers (Gida-Is). Istanbul : August 2005 .
Personal interview with Unver Uyar, leader of the Victims of Privatizations
(OM) Movement. Ankara: August, 2005 .
Personal interview with Salih Kihc, secretary-general of TURK-IS. Ankara:
August 2005 .
Personal interview with Suleyman Celebi, secretary-general of DISK.
Istanbul: August 2005 .
Personal interview with Tugrul Kudatgubilik, secretary-general of Turkish
Emplo yers Confederation (Turkiye Isveren Sendikalari Konfederasyonu,
TISK) and secretary-general of Turkish Metal Industrialists Union
(Turkiye Metal Sanayicileri Sendikasi, MESS). Istanbul: August 2005 .
Personal interview with Veysel Tekelioglu , department head at Privatization
Administration. Ankara: August 2005 .
Personal interview with Victor Paulon, secretary-general of UOM in Villa
Constitucion . San Nicolas: June 2006.
E-mail communication with Emanuel Ynoub, instructor of labor relations at
the University of Buenos Aires. Buenos Aires: February 2007.
Phone interview with Dr. Hector Recalde, MTA's lawyer and the current
national deputy in the Argentine Parliament. February 2007.
E-mail communication with Alvaro Or satti, ORIT-CIOSL. New York: April
2007.
E-mail communicationwithAzizCelik.Kristal-Is Union (Glass sector
workers union). New York: February 2007.
INDEX
Page numbersfor tables are in boldface.
AKP, Adalet ve Kalkinma Partisi Collective

23,33,105,113-114, action 11,20, 110, 114,
118-120, 190 116, 117, 119, 158, 175,
Alfonsin, Raul 73, 75-76 , 79, 177-179,181,196-198,
129-131, 134, 138 203-204, 206
Alliance unionism, see also new agreement 26,47-51,53-54,66,
unionism 18,52,191,197 76-78,83,140,147,151,
ANAP, Anavatan Partisi 33, 157-158,169,185,203
50-51,54,92,95 bargaining 14,45,47-49,61,
Anarchism 61-64, 66,75,77,80
Ataturk, see also Mustafa Kemal mobilization 28
33,200-203 Cordoba 156, 160, 163,
165-166, 170, 171-172,
Black Gold, see also Oro Negro 176-177, 195
125,184, 197 Cordobazo 70
Bursa 26,97, 112-114 Corporatism 158-159, 186,
189-190
CATEP, compare with Emekli Coup d'etat
(Demokrasi) Platformu 23, in Argentina 68-71,127
154-155, 180 in Turkey 32, 45, 48-50,
CCC, Corriente Clasista y 52,199
Combativa 22,143, 148- CTA, Central de los Trabajadores
149, 152-160, 187 Argentinos 22, 80-83, 184,
CGT, Confederacion General del 187,192,195-197,206
Trabajo 21-22,61 ,64-74,
80-83, 123-124, 137, De Hoz, Martinez 72
142-149, 150-159, 161, 165, 25,
Democracy, internal union
167, 177, 179, 187-189, 195, 29,30,86,96,109,184,
201-202 191-192
Check-off system 44,47 Democratization
CRP, Cumhuriyet Halk Partisi in Argentina 58, 60, 73 , 75-76 ,
24,40-42,45,47,50, 83, 124, 127-129, 138, 147,
201-203 157-160
254 INDEX
Democratization ( Continued) Globalization, see also economic

in comparison 184,188,190, globalization 1,8, 13-15,
192,203-207 18,52,98,102,107-108,
in theory 9-14, 17-18,20-22, 144, 153, 155, 180, 186, 192,
24-25,29-30 203-207
in Turkey 33-34,51-52,56,
85,88,95,99,103-108, HAK-IS (labor confederation
1l0-1l1, 114, 116, 119, with an Islamic pedigree in
121 Turkey) 21-22,47-48,53,
Deputies (of union background) 55,86,97,100,104-107,
in Argentina 77 109-110, 112,113,116
in Turkey 43, 50 Hirschman, Albert O. 87, 185
DISK-Left-Ieaning labor
confederation in Turkey Identity 26
21-23,26,46-56,96-97, Identity, labor 103-107,
100, 103-104, 106, 109-110, 171, 191
113, 187, 192 Identity, national 75, 201
Ideologies 31,40,57,60,63,
Economic 65,68-69,96-98,100,
crisis 15,32-33,47,58,72-73, 103-107, 112, 117, 119-120,
94,128,132,205 124, 127-128, 143, 145,
development 12,59,60,87-88, 148, 158-159, 165, 168-171,
91,99,128-129,200-201 174-179
globalization 7,98,102, Import-substitution
107-108,205 industrialization 46
gro~h 9,68,91,94,155 Informal sector 78-79, lIS, 126,
Emekli (Demokrasi) Platformu, 144
compare with CATEP Interests, national 42, 49, 202
23,52 Interests, workers 49,61,76-77,
Encuadramiento 139-140, 157 83,86
Etatisrn, see also statism 87 Intermediary Management Body
Export-oriented industrialization (1MB) 151, 154, 188
60,88,95,127 International Labor Organization
(ILO) 52, 101
FATLyF-Light and Power Islamism ll, 104-107, 113,
Federation 140, 142, 147 120
FETERA-Energy Sector labor Izmit 113-114, 118-119
federation in Argentina
146-147, 161, 174 Iusticialista Party (Partido
Focus groups ]usticialista, Peronist Justice
in Argentina 167-175,204 Party) 60, 131
in Turkey 98, Ill, 112, 113,
114-120,204 Kemalism 98, 116, 199-201,207
FOECYT (Argentine federation of KIGEM 103, 106
postal service workers) Kirchner, Nestor 136, 149-150,
146-147,156,161,170 163-164, 190
INDEX 255
Labor unions 29 Outsourcing 78,84,140,157,

labor unions, business 22, 160, 198
53,82-83,106,109,140, Ozal, Turgut 35,55,72,79,88-89,
142,143,149,154,156, 92-94, 129, 131, 137, 198
158-159, 187-188, Ozellestirme Idaresi, 01 91, 115
193, 195 Ozellestirme Magdurlari, see also
labor unions, civic 85, 106, Movement of Victims of
126, 187-188 Privatization 114, 125, 195
labor unions, clientelistic 26,
55,67,78,82,84,107 PAP (politics of above parties) 50,
LyF (Luz y Fuerza) 140, 142, 52-55,69,75,99-101,107,
148, 155, 164, 165, 176 109
Participation 13, 17-18,20,27,
Mar del Plata 148, 162, 164-165 29,69,83,112,114-115,
Menem, Carlos 22-23,60-61, 121, 139-143, 146-147, 151,
76-79,81 ,93,95,129,131, 153,155, 158,175,178,180,
133-134, 136-138, 142, 144, 184 ,188,192,197,204,206
149, 150-151 , 169, 187, 198 Partisansh ip 16,43-47,62,75,
Menemism 80,82, 143, 156 79-80,82,86,103,105,109,
Microemprendimiento (small 112, 124, 167, 178, 185-189,
loans) 125, 163, 195 192-193,195,197,203,205
Movement ofVictims of Privatization, Patronage 66,95, 101, 103, 109,
see also Ozellestirme Magdurlari 139
114-116, 120 Peron, Juan 66-72, 126-127,
Movimiento de los Trabajadores 200-203
Argentinos, (MTA ) 22, Peronism 28,30-31 ,66-82, 124,
80-83, 142-143, 149-151, 127, 129-131, 133, 138-139,
153-158, 180, 187 142-144, 168, 171, 177,
Moyano, Hugo 22,80-81, 198-203
150-153, 156-157 Petrol-Is 46 ,98-99, 107, 109,
Murillo, Victoria 82-83, 142 112,11 5,1 70
Mu stafa Kemal Ataturk, see Ataturk Piquetero 13,28, 149, 164, 180,
187,205
Neoinstitutionalism 20, 183 Pluralism 15-16,33,186,189,206
Neoliberalism 47,50,54,60-61, PPP (programas de propiedad
72,97,100,142-143,150, participada) 9, 140-141, 152,
153,198,200-206 156,162,168,173
New unionism 18,86, 107, 109, Protest
123-124, 140, 157, 162, 184, in Argentina 68,73,80, 148,
189 , 191 150, 159, 162, 170,
173-174,176-178
Onis, Ziya 24 , 89 in general 11-12, 14-16,28,
Oro Negro, see also Black Gold 30, 189, 195
125, 184, 196 in Turkey 39,41,46,49,51,53,
Ottoman Empire 37-40,59-60, 91,95,101,111 ,113-116,
63,87,92,185 119-120, 196,203
256 I NDEX
Radical Party 60-65, 73-75, TURK-IS 21-23,27,43-49,

127, 129, 131, 133-134, 138, 51-53,55,95-97,99-110,
143-144, 148 116, 170, 187, 189
Retiro voluntario, see also voluntary
retirement 125, 164, Unemployment 76, 78, 80, 84,
167-168, 173 92, 101, 119, 121, 144-145,
148-149, 153, 159, 162, 164,
Sampling 19, 30 169, 179-180, 193, 194
San Nicolas 26,83, 141, Un ionism 43-46, 50, 53-55, 66,
146, 154, 160, 162-165, 69,71
177,195 unionism, economic 82,187
Social movements 18,26,29-30, unionism, intellectu al 83, 187,
65,110-111,113,115-116, 192,203
119-121,125,159,173,175, unionism, political 81-82,
177-181, 184, 187, 195-198, 150, 187
202 Unionism, new 184, 191
Social security 65, 68, 78, 80, 82, Un ionism, yellow 27, 104
Ill, 150-153, 175 Unionismo 124,174-175,178,
Socialism 39,61-64, 104, 185 192,203
SOEs (state-owned enterprises) Un ions, see labor unions
in Argentina 69,72,76-81, UOM (Argentine union active in
130-133, 139, 140-141, the metallurgy sector) 26,
144, 150-152, 166, 177 73-74,83,141,144,146,147,
in general 8-9, 12, 14, 150,154,163,165,177,195
28, 193 UPCN (Argentine union of state
in Turkey 34,36-39,54,88-101, employees) 82, 142, 146,
106, 113-114, 117 147, 151-152, 158
Stateness 23-24, 85, 123, 188,
190,197,204,207 Voluntary retirement, see also retiro
Smtism 41,85-87,89,98,129,201 voluntario 28, 125, 164, 167
Street fighter, see piquetero
Strike 41-42,45-49,51,61, Workers'
71-73,79,88,101,131,134, responses to privatizations,
138, 147, 153-154, 157, 170 Argentina 159-178
Structural adjustment 8,33,89, responses to privatizations,
93,130,205 comparative analysis
192-197
TBMM (Turkish Grand National responses to privatizations,
Assembly) 33,202 Turkey 110-120
Technocracy 50,93, 199
Tilly, Charles 224 Yacimientos Petroliferas Fiscales (YPF)
Timar 35-36 68, 125, 135, 173-175, 197

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DEMOCRATIC INSTITUTIONS OF

PRIVATIZATIONS, LABOR, AND DEMOCRACY

First published in 2009 by PALGRAVE MACMILLAN® in the

Palgrave Macmillan is the global academic imprint of the above

Palgrave® and Macmillan® are registered trademarks in the

ISBN 978-1-349-37670-4 ISBN 978-0-230-61789-6 (eBook)

Library of Congress Cataloging-in-Publication Data

A catalogue record of the book is available from the British Library.

Design by Macmillan Publishing Solutions

First edition: January 2009

Transferred to Digital Printing 2011

List of Tables and Figures vii

Abbreviations and Glossary IX

Preface and Acknowledgments xv

Introduction: Democratic Institutions of Undemocratic

1: A Recipe for Deciphering Democratization Today:

AFL-American Federation of Labor

CoGT-Comision de Gestion y Trabajo (Commission of Administra-

FOEESITRA-Federacion de Obreros, Especialistas y Empleados

MSP-Milliyetci Selamet Partisi (Nationalist Security Party)

TISK-Turkiye Isveren SendikalariKonfederasyonu (Turkish Employers

I started thinking about the questions of democracy and democ-

Aziz Celik, Salih Kilic, Gulay Aslantepe, Suleyman Celebi, Veysel

Solutions, particularly Sailendra Dewan, Matt Robison and Allison

P rivatizations are a standard feature of the transition toward a

• In what respects do privatizations affect labor unions and unionized

This book attempts to provide answers to these questions though

in democratization patterns abound in globalization, that is to say

rejected them. Instead, it endeavors to understand the profound

main concepts, working hypotheses, and methodology. It defines

A RECIPE FOR DECIPHERING

PRIVATIZATIONS AND LABOR

Globalization is the increasing interconnectedness of the world

Table 1.1 Definitions of privatization

Regardless of the variety of methods employed, privatizations may

definition, which takes elections as the most important component of

but without the necessary and well-function ing systems of political

LABOR: LINKING PRIVATIZATIONS AND

social programs included in and associated with privatizations have

Number of countries covered

Table 1.3 Working days lost due to labor activity,

Number of countries covered

deunionization, these tables show that, at the peak of privatizations

Figure 1. 1 Trends oflabor conflicts (strikes) in Argentina (1980 -2002).

I-+- Strikes - - Other I

Christopher Candland (2001) argues th at partisanship renders unions

Figure 1.3 Trend s of/abor conflicts (strikes) in Turkey (1996-2005 ).

closer cooperation between unions and nongovernmental organiza-

who claim to speak on behalf of workers . Unions' collaboration with

from different educational, geographical, socioeconomic, and political

Convergence at the Institutions: Signs of Democratization

relations with nonunion actors, and minor changes in unions' internal

Structure of Unions: Triad Fragmentation and

form an independent labor confederation without the state's legal

unions used privatizations to retain and obtain economic and

External Role of Unions: Government- Union Relations

in the Turkish political matrix, such as the Republican People's Party

Unions) Internal Organization: Internal Union Democracy

Since the very same privatizations caused unemployment, workers

Divergence of Individual Responses: Apathy and

CONCLUSION: THE MAIN PUZZLE

This book argues that privatizations might have similar effects on

FROM STATE-DEPENDENT TO CAUTIOUSLY