Worker-Recovered Enterprises as Workers Cooperatives

The Conjunctures, Challenges, and Innovations of

Self-Management in Argentina

Las empresas recuperadas por sus trabajadores

como cooperativas de trabajo
Coyunturas, desafos, e inovaciones de la autogestin
en la Argentina
By: Marcelo Vieta and Andrs Ruggeri
This draft: May 30, 2007
Chapter submitted for: J.J. McMurtry and Darryl Reed (Eds.).
International Co-opertion in the Global Economy,
Cambridge, UK: Cambridge Scholars Press (forthcoming).

Abstract
This chapter works through two particular characteristics that often get overlooked or
downplayed by studies that explore Argentinas worker-recovered enterprises (empresas recuperadas
por sus trabajadores, or ERTs). First, workers initial actions of seizing control of their deteriorating or
failed companies from former owners, occupying them for weeks or months at times, and eventually
putting them into operation once again under self-management (autogestin), come out of fear rather
than a preconceived predilection for workers control or working class revolt. That is, ERT protagonists
original impetus for self-management are defensive reactions against a callous and collapsing neoliberal
system that is embodied in the nefarious actions of business owners, bosses, and managers. Second,
most ERTs reorganize themselves within the rubric of a workers cooperative only after workers gain
control of former owner-run plants, not because the recovered firms workers already have vision of
becoming cooperativists, nor because they possess predetermined political ambitions but, rather, as legal
and pragmatically defensive strategies that emerge during or after the struggle to occupy or seize their
workplaces. To begin to understand these two overarching characteristics of Argentinas ERTs, the
chapter: 1) surveys the historical and political conjunctures that ERTs emerge from and find themselves
in, 2) the connections with the wider ERT phenomenon in Latin America and workers cooperatives
beyond the region, and 3) maps out a few of the challenges brought on by ERT workers direct action
tactics to defend their jobs and workspaces, as well as the innovations impelled by their desire to selfmanage. The chapter finally looks at a few ways that these innovations and challenges, in turn, shape an
ERTs very organizational structures and cooperative practices.

Since the late-1990s, around 185 mostly small- and medium-sized companies in Argentina that
had declared or were near bankruptcy, or were otherwise abandoned by their owners and bosses, have
been taken over and self-managed by former employees. In almost all cases, and usually after many
months of struggle, these worker-recovered firms formally organize under the legal framework of a
workers cooperative. Especially visible in the two years immediately after the countrys financial
collapse in late-2001, and responding directly to Argentinas exhausted neoliberal political-economic
system, the micro-economic and social transformations being shaped by empresas recuperadas por sus
trabajadores (worker-recovered enterprises, or ERTs) are meeting head-on Argentinas traditional
institutions inability to contain historically high levels of under-employment, unemployment, and
poverty gripping the country in recent years.
In this chapter, we appeal to our ongoing quantitative and qualitative political economic and
ethnographic work with over 70 ERTs across all economic sectors and regions over the past five years in
order to explore two particular characteristics that often get overlooked or downplayed by studies that
look at worker-recovered enterprises in Argentina.i First, workers initial actions of seizing control of
their deteriorating or failed companies from former owners, occupying them for weeks or months at
times, and eventually putting them into operation once again under self-management (autogestin),
come out of fear and anger rather than a preconceived predilection for workers control or working class
revolt. That is, most ERTs originate as direct responses to their worker-protagonists deep worries of
becoming structurally unemployed (Olmedo & Murray, 2002; Ruggeri, 2006). ERT protagonists
original motivations for self-management were especially in the first era of ERTs between 19972003 defensive reactions against a callous and collapsing neoliberal system that was embodied in the
nefarious actions of business owners, bosses, and managers (Fajn, 2003; Palomino, 2003). Second, most
ERTs reorganize themselves within the legal rubric of a workers cooperative only after workers have
gained control of the plant and usually after many weeks if not months of struggle not because the
1

recovered firms workers already had a vision of becoming cooperativists, nor because they possessed
presupposed political ambitions but, rather, as a legal and pragmatically defensive strategy that emerges
during or after the struggle to occupy or seize their workplaces. For reasons that we will elaborate on in
the following pages, this organizational move has become an especially important defensive maneuver
for ERT workers in light of the very real threat of repression from the state and Argentinas capitalist
establishment, for structuring the horizontally democratic models of decision-making and remuneration
they usually take up, and for securing market share and hard-to-come-by loans and other forms of
financing.
To begin to understand these two characteristics, we first briefly look to the historical and
political conjunctures that ERTs emerge from and find themselves in. We then briefly touch on some of
the connections with the wider ERT phenomenon in South America and workers cooperatives beyond
the region while, at the same time, indicating some of the distinguishing features of Argentinas ERTs.
To illustrate these features, the last part of the chapter maps out a few of the challenges brought on by
ERT workers direct action tactics to defend their jobs and workspaces and the innovations impelled by
their desire to self-manage. As we will show throughout, these innovations and challenges, in turn,
usually shape an ERTs very organizational structures and cooperative practices.

The Historical and Political Conjunctures of ERTs in Argentina

Argentine labour expert Hectr Palomino (2003) writes that the political and economic impacts
of the ERT phenomenon are more related to its symbolic dimension than to the strength of its size (p.
72) since, to date, the phenomenon involves roughly 185 mostly small- and medium-sized enterprises
estimated to include between 9,000 and 10,000 workers (Ruggeri, Martinez, & Trinchero, 2005). While
currently making up the largest conglomeration of ERTs in Latin America, the phenomenon constitutes
less than one percent of Argentinas 14,393,000 officially active participants in its urban-based economy
(Ministerio de Trabajo, 2004). As Palomino (2003) points out, however, while it is true that this reflects
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only a fraction of the economic output of the country, ERTs have nevertheless inspired new
expectations for social change (p. 72) since they especially show an innovative and viable alternative to
chronic unemployment and under-employment (also see: Scarano & Snchez, 2005). But the road to
self-management has been, and in many ways continues to be, economically and politically rocky for
these fledgling workers cooperatives despite the relative recomposition of the Argentine economy in
recent years under the government of Nestor Kirchner.

Starting around 1995, thousands of smaller- and medium-sized businesses in Argentina began to
lose market share and amass unwieldy debt loads due, in part, to the drying up of export markets during
Argentinas economic liberalizations of the 1990s and, in particular, the aftereffects of Carlos Menems
administrations (1989-1999) dollarization of the peso and the sell-off of over 150 once-nationalized
firms. By the mid-1990s it was clear that these neoliberal policies were affecting the competitive
advantage of Argentine products in foreign markets (Damill, 2005).ii Moreover, the large wave of
privatization schemes, company downsizing, and the foreign capitalization of large portions of
Argentinas industrial base further compromised the competitiveness of thousands of small- and
medium-sized firms, eventually causing them to declare bankruptcy at unprecedented rates starting
around 1995 (Boron & Thwaites Ray, 2004). These macro-economic realities effectively relegated
hundreds of thousands of workers to the growing ranks of the unemployed (Damill, 2005; Patroni,
2004).iii Other business owners simply abandoned their companies in the wake of such economic
difficulties leaving employees in the lurch. In many cases, workers were let go after weeks or months of
not receiving the employers portion of social security contributions, bonuses, and finally after not even
receiving pay cheques. While some of the ensuing bankruptcies were legitimate, due either to the
incompetence of management or the firms inability to compete in the new globalized reality, others
were illegal as many business owners, encouraged by the frontier-style economic free-for-all that
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defined Argentinas economy in the 1990s, were willing to incur questionable debt, speculate away their
business assets in risky investment schemes, or turn to embezzlement to stay solvent (Damill, 2005).
In many cases that led to bankruptcies or owner-abandonment workers were really the first
creditors because bonuses, benefits, and pay cheques (usually in that order) would be the first things not
paid by negligent owners. In reality workers had little choice but to become creditors: The implicit
ultimatum given to them by bosses an ultimatum that was well understood by workers was to either
work for vastly reduced wages, pay vouchers, no benefits, and no overtime pay, or to not work at all
(Magnani, 2003). The massive erosion of jobs throughout the 1990s, the growing rate of immiseration, a
national currency crisis, eroding export and national markets, an un-payable national debt, and
exorbitant debt-servicing and structural adjustment demands insisted upon by the IMF and
enthusiastically carried out by the Menem and Fernando de la Ra (1999-2001) regimes all wedded to
the political and economic establishments greed serve as the macro-economic backdrop to the growth
of the ERT phenomenon in Argentina that began to noticeably surge in the socially and economically
volatile years between 2000-2002 (Palomino, 2003; 2005).
In response, the chronic economic instability and an increasingly precarious job-market forced
some workers to look to themselves and their surrounding communities for job security and dignified
living conditions. Moreover, the indifference, if not outright hostility, towards the plight of the lessfortunate and the working classes by the countrys elites compelled ERT workers to feel that they had on
their side a moral imperative to takeover companies and self-manage them. And many Argentines across
all social sectors, aware of the chronic rates of unemployment and poverty that plagued the country,
supported workers tactics of occupation, takeovers, and self-management (Palomino, 2003).
ERTs as Recovered Workers Cooperatives
Faced with these stark realities, workers from enterprises that are nearing bankruptcy or are
already bankrupt decide to take direct action. While 94% of ERTs eventually self-organize under the
4

legal framework of a workers cooperative during or just after the embattled workers choose to regroup
and re-occupy the firm (see: Figure 1; also see: Fajn, 2003, p. 105), the path to cooperatively organized
self-management in Argentina especially for those ERTs that originated during the socio-economically
tumultuous years that saw the implosion of the zealous neoliberal model between 1997-2003 (the first
era of ERTs) is usually long, emotionally draining, and sometimes life-threatening. And in most
cases, while some of the workers have experience in union organizing and community politics, most
workers just starting an ERT have no experience in any form of cooperativism (Mart et al., 2004).
Thus, in addition to having to recompose a deteriorated plant, learn new administrative and
marketing skills, reorganize purchases and customer orders, and generally run a firm in difficulty,
learning how to be cooperators adds to the challenges ERT workers face early on. And while it is true
that as of 2002, 41% of Argentinas universe of cooperatives were identified as workers coops (see:
Chart 2a), only 1.5% of these (or 98 coops) were ERTs as of 2002 (Palomino, 2003, p. 75). That is,
98.5% of workers coops as of 2002 did not originate from workers taking over failed capitalist firms
via tumultuous political struggles that they then had to run themselves without any previous experience
in cooperativism. The great majority of workers coops in Argentina are, rather, cooperatives that were
formed either before the era of ERTs (i.e., post-1997), coops that did not have to pass through the
traumatic circumstances of taking over plants from deteriorating owner-run firms, and are usually
staffed by more experienced cooperators working within better economic conditions, with better
machinery, and with more stable productive capacities (Montes & Ressel, 2003).iv
So then, why is it that roughly 10,000 workers on the brink of structural unemployment, most
without any previous experience with working in or organizing a workers coop, engaged in risky
takeovers of their failing or failed companies and then turned to worker cooperativism as a way of
securing their jobs starting around 1997? The most direct answer is to be found in the public debates that
were in the early years of the phenomenon preoccupying ERT workers, social economy and social
5

movement activists, and the phenomenons first political leaders such as Eduardo Mura of the
Movimiento Nacional de Empresas Recuperadas (MNER)v and Luis Caro, who has since split from
MNER and formed the Movimiento Nacional de Fbricas Recuperadas por sus Trabajadores
(MNFRT).vi One of the major issues on the table at the time was the legal and administrative framework
ERTs were to take: nationalization under workers control or workers cooperativism (Ruggeri,
Martinez, & Trinchero, 2005, p. 67; Fajn, 2003, p. 105-106). While nationalization under workers
control was theoretically and historically plausible, early ERT protagonists eventually scrapped the
option when it became clear that the state municipalities, provinces, and the national government
was refusing to go along with the proposal (Fajn, 2003; Mura, 2006). The only practical and legally
recognized alternative for ERTs, it was decided in these debates, was to, out of convenience, turn to
the cooperativist model, especially in light of a state that could not, because of its strong commitments
to capitalist enterprise, set the precedence of nationalizing once proprietary firms (Ruggeri, Martinez, &
Trinchero, 2005, p. 67; Mura, 2006).
Thus, a point we must underscore here is that the decision by an ERTs workers to eventually
organize as a workers cooperative is not really a choice with many other options in Argentina, given the
states lack of will to seek alternative organizational models for ERTs. Each ERTs worker collective
comes to the awareness of a cooperativist solution usually after the process of occupying or taking over
the firm has begun and often after consulting with social economy protagonists that had been a part of
these early debates, older ERTs, sympathetic lawyers and local politicians, or ERT organizations such as
MNER and MNFRT. In other words, rather than turn to cooperativism proactively out of a preconceived
or longstanding desire to be cooperativists, ERT protagonists decide to turn to cooperativism as part of
their defensive strategy once they realize that it is the most practical, already-available, and ultimately
one of the only feasible and legally recognized organizational structures in Argentina for self-managing
a bankrupted firm (Fajn, 2003; Mart et al, 2004).vii In addition, an ERTs workers collective, as some
6

workers have told us in interviews and as we explain later, comes to the realization that becoming a
workers cooperative actually offers them a much more egalitarian foundation from which to counteract
the effects and memories of the exploitative structures and practices of the capitalist firm they had once
been a part of (Centro de Documentacin, 2007). The legal framework of a workers coop thus
facilitates addressing workers communal desires, needs, and issues that arise with its workers; the
democratic forms of one-worker-one-vote decision-making most ERTs adopt; and the equitable
redistribution of revenues many of them seek. At the same time, becoming a workers cooperative rather
than another form of entity (see: Figure 1) opens up the ERT to financial and taxational benefits, protects
the worker-members from the seizure of their personal property should the coop fail, and ensures that
the ERT does not have to pay taxes on revenues (Fajn, 2003, p. 105-106). Becoming a coop is also fairly
straightforward in Argentina: cooperators need only wait 30 days for the founding paperwork to be
processed and can start to commercialize the coop immediately after filing the papers requesting to
become a cooperative (p. 106). There are also practical benefits of forming a cooperative: The move
legitimates the ERT in the minds of potential customers and other firms within their market sector,
transforms the ERT into an entity that can more easily receive credit and government subsidies, and
makes it infinitely easier for worker-recovered firms to seek legal protection from returning owners.
A more nuanced answer to the question of why ERTs become workers coops requires us to
look, if briefly, into the history of workers struggle in Argentina, recent experiences with workers
control and workers cooperativism in other conjunctures, and current ERT experiences throughout
Latin America.
While, as we work out throughout this chapter, ERTs possess some peculiar characteristics that
distinguish them from workers coops in other conjunctures, in several ways they too fit the broader
definition of a workers cooperative found in the literature. For example, ERTs are voluntary
associations of workers cooperating in running a productive entity where each worker has an equal
7

say in the running of the coop (Matthews, 1999, p. 198) via workers boards or councils elected from
its membership base (Quarter, 1992, p. 27). ERTs too are productive entities where labour hires
capital (Smith, Chivers, & Goodfellow, 1988, p. 25), where work is the common contribution of each
member, (INAES, 2007), and where control is linked to work (Oakeshott, 1990, p. 27). And, ERTs
revenues and profits are also the common property of the coop (Ontario Worker Co-op Federation,
2007), although, as with the workers coop movement historically and worldwide, how to divvy
revenues and profits to individuals and reinvest revenues back into the firm remains an open-ended
question being imminently worked out within each individual ERT (Oakeshott, 1990; Ruggeri,
Martinez, & Trinchero, 2005).
But in some other practical ways ERTs delineate new experiments in worker cooperativism.
Their novelty, as we will outline in the following pages, flows from five main characteristics that are
rooted in their origins as ERTs and their subsequent organizational innovations. These characteristics are
present in almost all ERTs we have looked at: First, all ERTs are distinguished by the fact that they were
taken over by embattled former employees in risky occupations or confrontations with owners or
Argentinas juridical-political establishment out of fear and desperation at having to face the closure of
their workplace in an economy with record levels of structural unemployment and poverty (Fajn, 2003;
Ruggeri, 2006). Second, most ERTs endevour not to replicate the management hierarchy and
exploitative practices of the former company, at least in their first months of operation as a self-managed
firm. Even though, as we will discuss shortly, subsequent economic hardship within highly competitive
markets has compelled some ERTs to return to more hierarchical management practices (Fajn & Rebn,
2005), ERT workers tend to nevertheless struggle against this temptation as much as possible. Third, and
as such, many ERTs have extremely flat self-management structures and almost all to some degree
engage in one-worker-one vote direct-democracy adopted not necessarily from the values of
cooperativism but, rather, from the anti-capitalist contagion of horizontalism that emerged from
8

Argentinas anti-neoliberal social movements of the 1990s (Ghibaudi, 2004, p. 6). Fourth, unlike most
other cooperative experiences, many ERT workers coops are distinguished by a predominance of total
or near-total cross-the-board egalitarian pay schemes despite worker seniority or skill-sets (Bell, 2006;
Matthews, 1999; Ruggeri, Martinez, & Trinchero, 2005). Finally, these four factors, as we will discuss
throughout the rest of the chapter, emerge out of and because of ERTs long road to self-management
(Palomino, 2003; Ruggeri, Martinez, & Trinchero, 2005). While we of course do not claim that other
workers cooperatives in other conjunctures have not encompassed one or more of these distinguishing
marks, we do make the argument here that the pervasiveness of these tendencies in most of Argentinas
185 or so ERTs are, taken together, unique experiences in the history of workers cooperatives and
workers struggles against capital in Argentina and perhaps also beyond its borders (also see: Fajn,
2003; Mart et al., 2004; Camilletti et al., 2005).

It is perhaps no surprise that the early ERT debates that settled on worker cooperativism emerge
in a country with a long past in cooperativism. Its first cooperative society being founded in 1875
(Shaffer, 1999, p. 149), Argentine cooperativism is linked to the countrys long history of European
economic influence and the waves of immigrants from all corners of Europe that flooded in with new
ideas of how to organize working life in the last quarter of the 19th century (Montes & Ressel, 2003).
Indeed, Argentine cooperativism was the first to begin in a country outside the industrialized countries
of Europe, Australia, Canada, Japan, and the United States (Shaffer, 1999, p. 149). But Argentinas
cooperative sector has gone through fairly profound economic changes in the past two decades.
For example, Argentinas cooperative sector has witnessed a paradoxical development as an
outcome of the countrys sharp turn to neoliberalism over the past three decades. As Chart 1 shows,
there was, on the one hand, a marked increase in the number of cooperatives between 1985 and 2002. In
1985, there were a total of 4,204 cooperatives in Argentina, jumping to 8,142 by 1991 and 16,008 by
9

2002. While this represents almost a threefold increase in the number of registered cooperatives in
Argentina in just under two decades, combined membership in cooperatives, on the other hand, dropped
almost twofold in the same 17-year period: In 1985 there were over 10 million cooperative members in
the country. In 1991, just over 9 million. And by 2002, the number of total cooperators in the country
had fallen to just over 6.8 million members (Montes & Ressel, 2003, pp. 17-20; Shaffer, 1999, p. 139).
Recent studies hypothesize that this paradoxical inversion of growth in the number of coops with
declining membership had to do with the rise of neoliberalist policies, especially the establishment of an
unregulated free market system and the entrenchment of a globalized marketplace in Argentina which
intensified competition, destroyed established national networks of production and distribution, and
subordinated much of the countrys economic development to the whims of international financial
capital (Basaes, 1999; Camilletti et al., 2005). While this truculent neoliberal model was strengthening
its hold on the Argentine economy throughout the 1990s, labour flexibilization and privatization
schemes were also exerting strong blows to cooperatives especially with those that operated within
sectors most affected by Menems unregulated free market policies, such as agriculture, transportation,
public services, and natural resources (Muoz, 2005; Roggi, 2002). As Alberto Muoz (2005) has
recently written: In the privatization process of the mid-1990s, the cooperative movement was not only
denied the possibility of participating as an alternative, it was effectively excluded (p. 97).
Some have theorized that this inverted growth of coops/drop in members might have to do with
the rise in what in Argentina are called false cooperatives cooperatives that were formed by the
outsourced workers of larger firms and multinationals that were downsizing during the 1990s in order
for these corporations to unburden themselves of high labour costs. Assisting former workers and
entire workspaces to become cooperatives that downsizing firms were then to ostensibly do business
with were, in reality, practices of labour flexibilization and union busting. Fundamentally, the practice
served to deaden the inevitable negative reactions by organized labour to what in essence were job cuts.
10

As Mario Mittelman (2005) suggests, these firms facilitated the creation of these false cooperatives in
order to appear to be supporting an alternative to the loss of jobs (par. 2). For Mittelman, these
practices were counters to a problem that presents itself periodically in Argentina labour strife in the
midst of downturning economies and unemployment (par. 2).viii
Indeed, the rise in worker-productive cooperatives in Argentina, from 25% of total cooperatives
in 1991 to over 40% by 2002 while the number of cooperators dropped twofold over the same period
can in part be explained by the surge in these false cooperatives. But the rise in the number of smalland medium-sized ERTs and cooperativized micro-enterprises in recent years, plus the states
subsidization of new coops as a method of outsourcing the delivery of public services that it had
privatized in the 1990s have also contributed to the surge in worker productive coops in the country
(Montes & Ressel, 2003; Muoz, 2005; Roggi, 2002; Una Argentina Solidaria, 2005).
ERTs Across Latin America: A Brief Comparative Look
Alfredo Camilletti et al. (2004), Juan Pablo Mart et al. (2005), and Javier Ghibaudi (2004), in
comparative studies of the strategies and tactics of ERT workers cooperatives and other forms of selfmanagement in Argentina, Chile, and Uruguay (Camilletti et al., and Mart et al.), and Argentina and
Brazil (Ghibaudi) all emphasize the particular longevity that ERTs have enjoyed throughout Latin
America. They also assert that the sharp rise in worker-recovered enterprises that then become workers
cooperatives in recent years in the region is proving to be a viable grassroots answer by workers facing
structural unemployment and the dismantling of national economies by speculative global capital and
neoliberal market policies. A brief comparative look at Argentinas ERT experiences in light of other
Latin American countries over the past 15 years or so namely Brazil, Uruguay, and Venezuela shows
how the defensive strategy by workers who faced the most negative effects of neoliberal policies across
the region unfolded within similar socio-economic and political conjunctures. It also reveals the
outcome of the more supportive position towards ERTs taken up by governments and unions in these
11

other countries in contrast to the ambivalence or outright hostility from the state and unions that most
ERTs in Argentina have had to innovatively work around. In light of any consistent institutional support,
the relative longevity of ERTs in Argentina is a testimony to the resilience and innovative capacities of
its workers.
While Argentinas ERTs are the most celebrated in the literature, ERT-type cooperatives
currently exist in Bolivia, Brazil, Ecuador, Mexico, Peru, Venezuela, and Uruguay (Centro de
Documentacin, 2007). Next to Argentinas experiences, however, and for reasons we will elaborate on
in the next few pages, Brazils, Uruguays, and Venezuelas are the most developed in Latin America
(Camilletti et al., 2005; Mart et al., 2004; Ruggeri, 2006). Ecuador and Mexico have only a few cases of
ERTs each (Centro de Documentacin, 2007) and space will not allow us to get into their particularities.
In Bolivia, grassroots occupations of property and nationalization schemes can be most readily found in
the primary resources sector such as mineral extraction, agriculture, and water (Cecea, 2005; Grant &
Shuffler, 2005). But if we stick to our strict definition of ERTs based on their most common experiences
formerly capitalist entities that have failed due to bankruptcy or owner abandonment in the face of dire
economic conditions and that were taken over by its former employees and transformed into workers
cooperatives only a few small-scale mines could be said to be ERTs in Bolivia (Bocangel, 2001). And
in Peru, a handful of ERT-type workers coops share the scene with hundreds of smaller self-managed
agricultural and housing initiatives (Babilon Poma, 2005). Because of the relative incipiency of ERT
experiences in Bolivia, Peru, Mexico, and Ecuador, a closer economic and political comparison to
Argentina can be gleaned from looking at Brazil, Uruguay, and Venezuela.
In Brazil, ERTs, called the autogeridas (the self-managed), started to emerge in the early 1990s
as a consequence of the rise in bankruptcies and unemployment due to its inflation and monetary crises
of that decade (Ghibaudi, 2004; Oxfam, 1999). Like in Argentina, almost all of Brazils 140 ERTs take
on the organizational structure of workers coops for similar legal reasons. The major difference
12

between the two countries is the strong support most Brazilian autogeridas enjoy from national and state
governments and the strong presence of the ERT umbrella organization Associao Nacional dos
Trabalhadores de Empresas de Autogesto (ANTEAG)ix which assists the autogeridas with
technological, financial, and administrative needs (Ghibaudi, 2004). In addition, and unlike the
Argentine experience, unions affiliated with the Workers Party-affiliated Central Unica do
Trabalhadores (CUT)x have been heavily involved in assisting Brazilian ERT workers with the
processes of company takeovers and self-management. Moreover, the Brazilian state considers ERTs as
integral players in its burgeoning social economy and, subsequently, they have the full attention of
President Lula da Silvas Workers Party. Consequently, to date, Brazilian self-managed workers have
not had to traverse as many political and economic hurdles as in Argentina (Ghibaudi, 2004).
Uruguays 18 ERTs, as with Argentinas, also began to emerge around the late-1990s as
responses to growing unemployment and bankruptcies in a country with an economy heavily intertwined
with Argentinas and Brazils (NETICOOP, 2005). The subsequent institutional experiences of
Uruguays ERTs, however, differ from Argentinas in that they, like Brazils ERTs, were supported
early on by the countrys only union federation, PIT-CNT. As in Brazil, Uruguayan ERTs have thus
enjoyed more economic stability than Argentinas on the whole (Camilletti et al., 2005). In addition,
Mart et al. (2004) contend that because, in contrast to Argentina, there has been historically in Uruguay
a tighter and more amiable relationship between working class organizations and the cooperative sector,
the Federacin de Cooperativas de Produccin del Uruguay (FCPU)xi has played a major role in
helping to articulate the methods of transforming formerly owner-managed workspaces into workers
coops. The FCPU has also done much to provide start up funds to new ERTs as well as offering them
various forms of technical, educational, and administrative assistance (p. 94).
And in Venezuela, Hugo Chavez has been inspired by the ERT experiences in Argentina, Brazil,
and Uruguay for his vision of blending self-managed workspaces with his project of nationalizing
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industrial plants via co-gestin (co-management) (Argenpress, 2005). The concept of co-gestin in
Venezuela has affinities with Yugoslavias model of state-sponsored co-managed factories working
within a blended centrally-planned and market economy (Lebowitz, 2005). While in Venezuela,
according to Marie Trigona (2006b), only some 20 companies as of late-2006 have been nationalized
and function under worker co-management or control (par. 2), a further 1,200 formerly owner-managed
companies that, as in Argentina, Brazil, and Uruguay, had declared bankruptcy or had been abandoned
by their owners were estimated to be occupied by their workers under no legal framework as yet. To a
greater degree than self-management in these three countries, the Venezuelan state has had a prominent
role in co-gestin, and occupations have been inspired and even openly encouraged by Chavezs vision
of a worker-led Bolivarian revolution (Argenpress, 2005; Lavaca, 2005). Indeed, since 2005, the
Chavez government passed numerous decrees facilitating such actions by workers (Campos, 2007).
However, while in mid-2005 Chavez predicted the worker takeover and nationalization of 800 or so
plants by the end of 2006, the 20 ERTs currently operating under co-management in Venezuela
represents only a handful of the 1,200 plants that are currently thought to be occupied in the country
(Trigona, 2006b; Venezuela Analysis, 2005). In light of the slow pace of nationalization, a grassroots,
worker-based umbrella group called Frente Revoloucionario de Trabajadores de Empresas en
Cogestin y Ocupadas (FRETECO)xii was formed in mid-2006 by workers of the nationalized and
worker-managed valve manufacturing plant INEVAL in order to strategize how the worker occupied
factory movement can multiply industry under genuine worker control (Trigona, 2006b, par. 3). It is
still too early to tell how successful FRETECO will be in this task or if its presence will assist and
speedup nationalizing the 1,200 occupied plants.
A Network of ERTs Across Latin America: Tentative First Steps
The First Latin American Encounter of Recovered Enterprises that took place Caracas,
Venezuela in October of 2005 was the first region-wide gathering of ERTs in Latin America (Lavaca,
14

2005; Martn, 2005; Trigona, 2006a). Attended by 400 worker protagonists from 235 recovered
enterprises, sympathetic unions, and government representatives from Argentina, Bolivia, Brazil,
Ecuador, Haiti, Mexico, Peru, and Uruguay, the event finally internationalized the ERT phenomenon.
Up till then, the sharing of ERT experiences had been relegated to comparative academic studies with
occasional contacts between the various countrys ERT leaders and invited workers at social economy
events such as the World Social Forum (Centro de Documentacin, 2007). And the Argentine delegation
of 300 workers, led by MNERs Eduardo Mura, took on an inspirational role at the event, while
Chavezs presence and his Bolivarian project offered the legitimacy of the Venezuelan state, financial
backing, organizational force, and articulated a regional vision for ERTs.
Besides completing 75 contracts and promissory agreements between the regions ERTs, the
conference participants also managed to cobble together what has come to be called the Compromiso de
Caracas (Caracas Accord) (Lavaca, 2005).xiii The accord detailed the vision for a multinational, workerled, and continent-wide initiative for a solidarity network of ERTs and other worker-run enterprises that
Chavez termed Empresur (Movimiento 13 de Abril, 2005). Empresur was envisioned as an
intercontinental economic network that would engage in not only traditional forms of trade between the
regions ERTs, but also see ERTs interact with each other outside of the neoliberal marketplace. As the
gatherings participants envisaged it, such solidarity-based interactions would also include the sharing of
technical know-how, the creation of funds for fair loans and investments, and the provisioning of raw
materials rooted in bartering, all working within a transnational network of cooperation that would also
offer political support for the legal hurdles faced by ERTs across the region (Martn, 2005). The accord
also took a strong stand against US-led neoliberal economic designs in Latin America (i.e., the FTAA)
and delegates envisaged Empresur as a key component of Chavezs alternative to the FTAA, the
Alternativa Bolivariana para Amrica Latina y el Caribe (ALBA).xiv Additionally, the delegates urged
all of the regions governments to set aside capital funds for ERTs and demanded that state governments
15

draft national laws and engage in constitutional reforms that would better support worker-recovered
enterprises and other forms of microenterprises.
But this event would also prove to be the apogee of the move to internationalize the ERT
phenomenon across the region; most of the contracts and initiatives that were signed, especially with the
Argentine ERTs, have yet to come to fruition. This was highly discouraging for Argentinas ERT
worker delegates who had gone to Caracas with expectations of signing numerous lucrative contracts.
And while the Caracas gathering witnessed Chavez officially launch his nationalization and factory
expropriation plans, the vision for an alternative Latin American network of multinationals without a
boss fell short of its promise. Our reading of why Empresur has failed to tangibly materialize is linked
to the substantial differences between ERTs in Argentina and those in Brazil, Venezuela, and Uruguay.
Argentinas official government delegation to the Caracas gathering, which was made up of third-string
bureaucrats with little political power, clearly delineated its governments indifference towards ERTs
and its unwillingness to co-finance Argentinas portion of the US$50 million in subsidies for the
regions ERTs that the Venezuelan government put on the table at the gathering. This has had real
material consequences for Argentinas ERTs: While various deals between the Venezuelan state and
ERTs in Brazil and Uruguay have already been consummated thanks to these states full support of their
ERTs, international protocol has prevented Venezuela from allocating these funds to or finalizing deals
with individual Argentine ERTs without the mediation of the Argentine state.
Something similar occurred with union representation at the Caracas meetings. While, as we
have already indicated, in Argentina ERTs have surged without the support of most unions, in Brazil,
Venezuela, and Uruguay ERTs have always been intimately linked to major unions as central players in
national labour struggles. Recognizing this central role, the Uruguayan cooperatives at the gathering, for
example, were accompanied by representatives from PIT-CNT. And Brazils ERTs in Caracas were also

16

grouped with reps from the CUT. Argentinas unions, on the other hand, were represented by a handful
of observers.
Because of the mixed outcomes of the Caracas meetings and the lack of government and
widespread union support for Argentinas ERTs, it was impossible to plan the second gathering that had
been planned for the regions ERTs for 2006. And the accords and contracts signed between Venezuela
and Argentinas ERTs have mostly been forgotten. Moreover, while regional conferences on selfmanagement such as the Caracas meetings and smaller academic gatherings have guaranteed some
continuing cross-pollenization of these experiences across the region, the bulk of the organizational
decisions, daily economic challenges, and socio-political conjunctures faced by the regions ERTs
remain uniquely tied to the national economic and political conjunctures they find themselves in.
Consequently, the Caracas Accords vision for Empresur remains largely a dream. In Argentina, this has
meant that most ERTs have had to put the project of forging a network of solidarity across Latin
America to the side as they continue to rely on the ingenuity and drive of its own workers, the solidarity
of the surrounding neighbourhoods, and fledgling national ERT networks. Thus, unlike in Venezuela,
Brazil, or Uruguay, the Caracas gathering put into relief and on display for all of Latin Americas ERT
protagonists how deeply in Argentina the state, most unions, and even the traditional cooperative sector
have been slow to step up and assist its fledgling ERTs. As we continue to articulate throughout the rest
of the chapter, this reality has shaped the practices and structures taken up by Argentinas ERTs.

The Antecedents of Argentinas ERTs

Notwithstanding the emergence of ERTs across Latin America in recent years that is estimated to
include over 30,000 workers (Trigona, 2006, par. 1), worker takeovers of firms and even large portions
of economic sectors is not new in the region. Historically in Latin America, however, instances of
workspace occupations and attempts at co- or self-management have occurred in exceptional political
contexts and usually with direct leadership from state governments, political parties, or unions. The most
17

salient historical examples include the 125 factories that were nationalized under workers control in
Salvador Allendes Chile between 1970-73; the nationalization and co-management of mines and rural
enterprises during Bolivias National Revolutionary Movement of the 1950s and J.J Torress
dictatorship of the early-1970s; the surge in cooperativized industrial communities in General Velasco
Alvarados leftist military regime in Peru during the late-1960s; and various situations of unioninstigated workplace takeovers in Argentina during the governments of Arturo Frondizi (1958-1962),
Isabela Pern (1974-1976), and Ral Alfonsn (1983-1989) (Petras & Veltmeyer, 2003; James, 2003).xv
Argentinas earlier experiences with workspace takeovers were not ERTs, however; in these
instances occupations were temporary union tactics occurring over short periods of time in the pursuit of
labour demands (Palomino, 2005). The phenomenon of worker-recovered enterprises as we know it
today in Argentina is, rather, a unique process associated with another type of socio-economic situation
that emerges out of the hegemonic and regressive neoliberal politics of the 1990s. The practices of
workspace occupations by ERT protagonists are only loosely linked to these earlier cases, drawing some
inspiration from them in the collective memory of those ERT workers, historians and theorists, and other
social protagonists that lived through them or recollect them. Moreover, the practice of self-management
in the Argentine ERT phenomenon is not about the revolutionary takeover of the state by the working
class, as were the intentions of the Bolsheviks or the role of workers cooperatives and industrial
collectives under the Spanish Republican government of 1936 (Woodcock, 2004); the reinforcing of an
already-established or aspiring socialist state under the rubric of co-managed factories, as in the stateowned and worker-run factories in Titos Yugoslavia, Allendes Chile, or the current aspirations of
Chavez in Venezuela (Petras & Veltmeyer, 2003; Trigona, 2006b); or about fighting for sectoral labour
victories via temporary workspace takeovers, such as the experiences of earlier Argentine factory
occupations, or worker takeover of plants in Canada as with the occupation of the Maple Leaf meat
packing plant in Edmonton, Alberta in 2005 (UFCW, 2005) or the ALCAN workers in Quebec in early18

2004 (La Nuit, 2004). Nor do Argentina ERTs emerge out of workplace buyouts as with some
Employee Share Ownership Plans in the US (Bell, 2006; Melnyk, 1985). Instead, the origins of
Argentinas ERTs resemble more other situations that emerge in other conjunctures during downward
economic cycles that see a large and sustained rise in unemployment. In these situations, as Johnston
Birchall (2003) asserts the most direct response to the effects of economic depression, deregulation,
and globalizing markets was to set up workers cooperatives that took over failing firms or parts of
firms that were still viable (p. 48). Other than the Latin American experiences with ERTs, similar
surges in workers coops as solutions to the growing rate of unemployment occurred, for example, with
the noticeable expansion in labour coops in Finland in the 1990s in the wake of the economic disruption
of that countrys white collar and service sectors caused in part by the break up of the Soviet Union
(Birchall, 2003), and the exponential growth in the Industrial Common Ownership workers coop
movement in the UK during its deep economic recessions in the late-1970s and early-1980s (Melnyk,
1985; Oakeshott, 1990). But something different also happened with ERTs in Argentina when compared
to these other historical conjunctures of rising unemployment: As Charts 2b and 2c show, ERT workers
coops are multisectoral, widespread, and cut across Argentinas entire territory. In addition, they are not
affiliated with state politics, are not union aligned, are not directly associated with an older cooperative
sector, and have been, despite the disparate nature of the sectors represented and the lack of strong
solidarity networks between ERTs, surprisingly long-lasting.

Taking over workspaces to gain labour victories has been a practice that in Argentina extends as
far back as the anarchist labour movements of the early 20th century (Munck, Falcon, & Galitelli, 1987).
Over the past 60 years, in particular, the cultural and political practices of the countrys workers in these
militant labour sectors have been most vividly influenced by the nationalist and corporatist ideologies of
Peronism and the political tactics that in the past had been taken up by more militant trade unions falling
19

under the pro-Peronist Confederacin General del Trabajo (CGT).xvi This Peronist-tinged imaginary
has, not surprisingly and via the memory of ERTs most militant workers, overlapped into the
phenomenons cultural and political milieu. Politically, many ERT protagonists have come from some of
the most militant industrial sectors of Peronist syndicalism such as the metallurgic and graphics sectors
which, not surprisingly, together make up 32.1% of all of Argentinas ERTs (see Chart 2c). We
especially witnessed this in the narratives related to us by many of the ERT protagonists we interviewed
(Centro de Documentacin, 2007): For them, work is not only a right but it also defines much of ones
human dignity. These are views that, within the context of the Argentine working class, Juan Pern
himself was the first to persuasively articulate (Munck, Falcon, & Galitelli, 1987; Svampa & Pereyra,
2004).
Paradoxically, the Argentina of the 1990s also witnessed an intensification of the severing of the
strong ties that syndicalist Peronism had traditionally enjoyed with the countrys popular sectors since
the late-1940s (Svampa & Pereyra, 2004). The dismantling of the just society that was first
consolidated by Pern in the 1940s began most fully with the neoliberal prejudices and brutal
repressions of the 1976-83 dictatorship (Patroni, 2004). The final vestiges of Perns vision of social
justice for all Argentines finally dissolved with Menems zealous neoliberalist plans (Svampa & Pereyra,
2004). Menems final dissolution of Perns nationalized benevolent state throughout the 1990s
relegated hundreds of thousands of Peronist syndicalisms traditional grassroots supporters the
unionized working classes to the ranks of the unemployed and the desperate. In response, starting
around 1996, thousands of those that were part of this descendant class and that lived in the cities and
towns that had been predominantly employed by Argentinas national firms began to take to the streets
and highways of the nation in the only form of protest that remained for the unemployed: squatting
roads and highways. In these tactics organized groups of the structurally unemployed managed to
directly hit the economic veins of the country. These mobilized and horizontally organized groups have
20

since come to be known as los piqueteros (the picketers) (Svampa & Pereyra, 2004, pp. 50-54).
What overflowed from these mobilizations of the unemployed onto other forms of popular
struggle beginning in the mid-1990s was a renewed sense of collective purpose against a callous,
exploitative, and socially alienating system; a growing ethos of democracy from below (Colectivo
Situaciones, 2002, par. 3); and a massive reactivation of communitarian social experience (Svampa
& Pereyra, 2004, p. 222). Antonio Negri (2003) observes that the responses of groups such as the
piqueteros to the radical liberalization of the national economy tactics of occupying and squatting
public and private spaces, horizontal forms of organizing, myriad neighbourhood grassroots social
initiatives, etc. bore witness to a new energy of universal conviction and of egalitarian social
recomposition (par. 2) that emerged from the urban barrios and rural towns of the country at the time.
These are the most direct roots of Argentinas recent horizontal contagion that also caught the ERT
protagonists, a contagion that impelled thousands of grassroots activists to self-organize organically and
under the rubric of peoples assemblies working within the principles of direct democracy. And, ERT
protagonists tactics of workspace occupations and seizures were most directly modeled after the new
social transformations that were taking shape around them (Svampa & Pereyra, 2004).
Thus, ERT workers strongest roots are not in the countrys recent cooperativist or union
movements but, rather, in a history grounded in grassroots workers struggles, Peronist syndicalism, and
newer forms of social protest against neoliberalism. And, it is the political tools that they learned from
these sources, not the cooperative model, that inspired thousands of Argentine workers to subsequently
begin to experiment with manager-free, horizontalized, and self-managed workplaces.

The Challenges of Forming ERT-Specific Organizations in Argentina

The complex historical and micro-particularity of each ERT in recent years makes identifying a
unified ERT movement virtually impossible. One reason for this is that ERTs, despite the support they
garner from other ERTs during the stages of occupation and resistance, and despite incipient attempts at
21

creating networks of solidarity between them, tend to become, on the whole, progressively isolated from
each other once they start production again, each ERT living out their own experience of selfmanagement within a capitalist sea that has managed to calm itself after the most intense crisis years of
2001-2002 (Fajn, 2003, p. 76). Thus, it has been difficult to organize them as a movement, within an
umbrella organization, or as a union.
Between early-2005 and the time of this writing (the first trimester of 2007), MNER, the lobbygroup and umbrella organization that between mid-2002 and mid-2003 constituted the largest grouping
of ERTs (and that, via the relentless early work of its president, Eduardo Mura, had done much to
articulate the processes and tactics of workplace occupation and recovery) has been experiencing a
period of acute fragmentation (Centro de Documentacin, 2007).xvii Indeed, perhaps this fragmentation
was foreshadowed by MNERs bifurcation in 2003, which produced the other major umbrella
organization, MNFRT, under the tight leadership of the conservative young lawyer Luis Caro.xviii In our
ethnographic and quantitative investigation of ERTs, we were able to determine a numerical parity of
ERTs belonging to either MNER and MNFRT as of early-2005 on their own, each organization
represented roughly 34% of ERTs that existed at the time (Ruggeri, Martinez, & Trinchero, 2005, p. 94).
At the same time we were also able to identify a fairly large lack of commitment on the part of most
ERTs with regards to these two umbrella organizations that were supposed to be representing their
interests. What we were also able distinguish was a more pronounced identification with these
organizations with ERTs that found themselves in the midst of their most conflict-filled days, and the
widest gap with these organizations with those ERTs that perceived themselves to be fully consolidated
as self-sustaining workers cooperatives. These findings, perhaps more than any other in our work with
ERTs, reveals the difficulty of organizing these highly autonomous workers collectives. One reason for
their non-committal nature to organizational politics, we theorize, lies in the perception amongst ERT
workers that their struggles were indeed their struggles and that, at the end of the day, it was only
22

themselves, their families, friends, and neighbours that truly risked their lives at times for the fight to
open up their workspaces as self-managed entities.xix
The vacuum caused by the subsequent dissolution of MNER and MNFRTs tightened control of
its ERTs have recently given impetus to several new fledgling ERT federations. The Federacin
Argentina de Cooperativas de Trabajadores Autogestionados (FACTA),xxfor example, was formed in
mid-2006 by several greater Buenos Aires-based ERTs with aspirations to create a space where ERTs
can collectively lobby and coordinate funds from the state and forge alliances with universities and
NGOs. Their hope is that these alliances will assist with technical and administrative upgrading, increase
ERTs revenue potential and market share, create or reinstitute lost retirement benefits, secure medical
and health coverage for ERT workers, and articulate tighter links between ERTs from the interior and
other cooperatives (Castiglioni, 2006; EnRedAndo, 2006). Another promising solidarity initiative is
being spearheaded by a group of steelworkers in the southern region of greater Buenos Aires, based out
of the Quilmes local of the national steelworkers union.xxi This cooperative/ERT/union consortium
currently assisting 13 member ERTs most notably managed to also negotiate agreements with several
European agencies and with the University of Quilmes to provide these ERTs with sources of technical
assistance and professional consulting services (Proyecto Redes de Personas, 2006).xxii Yet another
small group of ERTs are linked to the Federacin de Cooperativas de Trabajo de la Provincia de
Buenos Aires (FECOOTRA)xxiii and other political sectors working out of the municipality of
Avellaneda (FECOOTRA, 2006; Saavedra, 2003). And finally, ERTs working in the graphics and
printing sector are currently attempting to formalize a solidarity network of cooperatives throughout
greater Buenos Aires in order to pool resources and more effectively tackle the various challenges they
face in a highly concentrated and competitive printing and publishing market (Centro de
Documentacin, 2007).

23

Interestingly, the only group that has formed in recent years along the lines of a formal trade
union for ERTs has been the Asociacin Nacional de Trabajadores Autogestionados (ANTA).xxiv
Emerging from within the progressive Central de Trabajadores de la Argentina (CTA),xxv and founded
in late-2005 by sympathetic union activists that have had experience with various forms of selfmanagement, ANTA formed as a response to the states and traditional unions general indifference or
outright hostility to the plight of the self-managed, underemployed, and the unemployed. Initially made
up of 83 organizations of ERTs, microenterprises, and other workers collectives, ANTA has begun to
lobby the state to recognize the labour rights of the self-managed and militate to secure pensions,
stabilize sector-wide wages, create a national health and workers compensation plan, and provide these
self-managed entities with favourable loans. While a promising initiative, there are to date only a
handful of ERTs that associate themselves with this still-nascent organization; the majority of ANTAs
members are made up of cooperatives and microenterprises associated with Argentinas promising but
still-insipient solidarity economy and that have not originated from formerly capitalist firms (Centro
de Documentacin, 2007; CTA, 2007; Vales, 2005).
ERT-specific organizations such as MNER and MNFRT formed early on in the phenomenon,
during its first era (1997-2003), in part in order to articulate the processes of workspace recovery and
give ERTs and their unique experiences their own particular political voice and identity. The unifying
identity for the ERT phenomenon envisioned by MNERs and MNFRTs leaders early on was not
cooperativism per se but, rather, the very fact of being a worker-recovered enterprise (Lavaca, 2004).
And, by placing emphasis on the figure of the worker rather than the figure of the cooperator, MNER
and MNFRT steered ERTs away from forging strong links with the cooperative movement during
ERTs first era.
While cooperative associations such as the aforementioned FECOOTRA and the Instituto
Movilizador de Fondos Cooperativos (IMFC)xxvi had tried to make inroads with ERTs during the first
24

era, they had an uphill climb in convincing most ERT workers that linking up with the cooperative
sector would be beneficial given that a good number of them had been employees in capitalist firms with
no experience with cooperativism or had had negative experiences with false cooperatives. Having
said this, in the current, more politically stable second era of the ERT phenomenon (2003-present),
some ERTs have been encouraged to link themselves more closely with the cooperative organisms they
once shunned. Moreover, when talking to ERT workers today, one begins to notice a new tendency
among them to revalorize or reconsider what it means to actually be a workers cooperative. The
emergence of newer ERT-specific organizations like ANTA and FACTA, the loss of the political clout
of MNER and MNFRT, popular educational initiatives geared at ERT workers, and the reconsolidation
of the Argentine economy has led many ERTs to take a second look at the more established cooperative
sector as a possible space from which to forge new alliances and collectively recover (if not recreate)
larger sections of Argentinas economic output from capitalist interests. In addition, the tax advantages
and financial and legal support that Argentine cooperative legislation offers ERTs have begun to be
recognized by its protagonists as important reasons to emphasize more their role as cooperators. Whats
more, current ERT leaders such as those working with ANTA also feel that the state should establish a
unique legal status for ERTs that would recognize the particular needs and challenges of self-managing
recovered workers cooperatives within current national and global conjunctures and in light of the fact
that these workers had to take it upon themselves to learn things they could never have imagined they
would have needed to know.
What one notices in this brief overview of ERT organizations is that the character of formalized
associations and organizations of ERTs has transformed since the earlier days of the ERT phenomenon:
The early and implosive socio-economic years between 1997-2003, the ERTs first era, required
MNER and subsequently MNFRT to primarily focus on articulating and assisting ERTs direct action
tactics as well as initiate the struggle quite effectively, as it turned out for a national political voice
25

for its workers and for the reformulation of the countrys bankruptcy and expropriation laws.xxvii In the
current second era of ERTs, the need for more politically-minded entities such as an MNER or an
MNFRT has diminished substantially given the new and recomposed socio-economic climate of
Argentina. Currently, more economically focused and conciliatory umbrella organizations such as
FACTA or ANTA are stepping in to meet the new challenges faced by already-established ERTs within
a consolidated Argentine economy.

The Challenges and Innovations of Argentinas ERTs

In this last section we lay out some of the ways that ERTs challenges on the path to selfmanagement shape their new work processes, their egalitarian remuneration schemes, and the forms of
horizontality adopted by each particular ERT cooperative.
The span of time between the initial threats of owner-led closures of the business or bankruptcy
and full workers control as a workers cooperative tends to be long and filled with arduous struggle.
While most ERTs were either seized or taken over by workers, our research found that 50% of ERTs
operating currently in Argentina had to engage in lengthy periods of courageous workspace occupations
sometimes pitting militant workers against the state or thugs in the service of owners and even their
sectors unions (Ruggeri, Martinez, & Trinchero, 2005, p. 54). Whether workspaces were seized without
much fuss or occupied for an extended period of time before becoming and official workers
cooperative, most ERTs have had to then usually engage in lengthy battles with the courts and regional
legislatures for legal recognition of the workers cooperative and its right to control and use the
machines and assets of the recovered firm. Hence the slogan that was popularized by MNERs Mura:
occupy, resist, produce.xxviii The slogan also serves to concisely capture the three distinctive stages
most ERTs go through on their way towards workers control and self-management (Mura, 2006; Vieta,
2006a).
It is important to note that once the cooperative is formed, the struggle for recognition and self26

management is, more often than not, not over: Full workers control of the workspace also assumes that
local courts will override the outstanding bankruptcy proceedings that are usually still pending during
the first months of the ERTs existence or that a new debt repayment scheme will be struck with the
cooperative. It also assumes that local legislatures will ultimately decide to grant the militant workers
the right to operate the firm as a cooperative and have the ley de expropiacin (expropriation law)
declared on their behalf.xxix Usually, such court and legislative decisions only come after weeks and
months of more struggle as ERT workers lobby judges and legislators or even resort to the public
pressure of worker sit-ins at courthouses and legislative buildings.xxx
Some of the Practices and Tensions of Workers Cooperation in ERTs
Most ERTs become workers cooperatives for the reasons we outlined earlier (see: Figure 1).
However, the form that cooperation is to take is still being worked out within each ERT workspace and
across the sector. For example, the practical nature of the third principle of cooperatives how member
economic participation is to be taken up (Shaffer, 1999, p. 45; MacPherson, 1995, par. 46) is still up
for debate within most ERTs. That is, besides the widespread agreement among ERTs of the value and
necessity of members controlling the capital of the firm (MacPherson, 1995, par. 46) made easier
and encouraged by the flat horizontal model and small size of most ERTsxxxi how ERT members are to
receive limited compensation on the capital (par. 46) of the cooperative or how losses are to be
contended with, continue to be worked out pragmatically and debated within each ERT as it matures and
lives out the intricacies of self-management within a globalized market economy. For example, while in
many ERTs revenue capitalization and salary amounts regularly debated, voted on, and agreed upon by
the workers council or assembly, there is no trend across ERTs concerning what percentage of revenues
should return to the cooperative as capital, if some revenue and what percentage of it might be allocated
to local community needs,xxxii and how much is to be allocated for salaries and benefits. Also, these
revenue allocation decisions are often very susceptible to market cycles. More financially challenging
27

months are usually bridged with cuts to community contributions or, most often, salaries. These
difficulties have multiple causes but tend to be rooted in having to face intensifying market competition
with chronically low cash reserves, perhaps a fleeting customer-base, difficult orders to fulfill, and
challenges in securing loans.
Irrespective of these cyclical challenges, the continuing debates within ERTs and throughout the
ERT sector underscores what Ian MacPherson (1995) has characterized as one of the remarkable
special characteristics of the Inernational Co-operative Asociations cooperative principles: their
inherent flexibility to adapt to the economic and political particularities of a cooperative and the
collective needs of its members (par. 34). Indeed, the continued discussions within each ERT and
throughout the sector concerning the form that member economic participation should take accentuates
the importance that many ERT protagonists give to the principle of democratic member control (par.
34). And it is this aspect of Argentinas ERTs the high degree of ERT members that actively
participate in settingpolicies and making decisions (par. 34) that many journalistic reports often
highlight (see, for example: Albert, 2005; Garrigues, 2002; Lewis & Klein, 2004; Utne, 2003). Our
research, as well as other recent in-depth studies (Fajn, 2003; Rebn & Saavedra, 2006), found however
that there also are, not surprisingly, many nuances in how democratic member control is carried out in
practice. On the whole, larger ERTs tend to be administered by workers councils made up of ERT
members elected with a mandate of one or two years, while many also hold regular workers assemblies
that meet either on a periodic basis (usually monthly) or when major issues arise, or both. Smaller ERTs
tend to administer themselves primarily via the workers assembly and the collective solidarity of its
members. Day-to-day concerns are more often than not worked out ad hoc on actual shop floors via the
adoption of production processes that are (re)organized around flexible work teams. The internal
tensions between viable production processes and an ERTs democratic values are intimately related to
and echo the tensions of pitting democratized cooperatives within capitalist markets. These tensions
28

mean that ERTs must ensure that production runs remain as efficient as possible while also balancing the
needs and skills of each worker and the ERTs horizontal commitments. Also, their ad hoc work
processes and the empowerment that many ERTs give to each worker on the shop floor ensures that, as
we have mentioned before, the workers coop contrasts as much as possible with the exploitative
conditions they were under when they were employees.
One notable innovation being worked out by many ERTs is the preponderance of pay equity no
matter how senior a worker is or what skills he or she possesses. Our research found that 56% of ERTs
as of early-2005 were practicing complete pay equity (Ruggeri, Martinez, & Trinchero, 2005, p. 67).
This is perhaps one noticeable innovation that differentiates ERTs from the practices of other workers
cooperatives. The other 44% of ERTs practice varying degrees of more hierarchical remuneration
schemes tied to specific skill sets, seniority, or highlighting again how an ERTs history of struggle
shapes their organizational and remunerational structures whether or not workers were present during
the initial days and months of occupation (p. 80). Interestingly, the longer the ERT has been under
workers control the more likely it is to practice pay equity when compared to newer recovered firms.
For example, as Figure 2 shows, 70% of ERTs recovered during or before 2001 practice complete pay
equity while only 39% of those recovered between 2003-2004 do so (p. 80). In addition, the size of the
firm tends to also be linked to pay equity: 64% of firms with 20 workers or less practice pay equity,
compared to 47% of firms having between 20-50 workers and 54% of firms with more than 50 workers
(p. 81).
There are several explanations for these differing remuneration practices: Most notably, the
collective of workers belonging to smaller ERTs tend to spend more time interacting with each other on
a daily basis than those in larger ERTs and have more intimate knowledge of each others jobs, personal
lives, and concerns. This means, we have found, that smaller ERTs also tend to experience less
factionalism, individualism, and shop-floor competition when compared to larger ERTs with more
29

dispersed work teams (p. 81). Another reason some ERTs tend towards pay equity more so than others is
because workers from more egalitarian ERTs have usually known each other and worked together for
longer periods of time or have a longer history of experiencing common struggles together. A related
reason for an increased likelihood of pay parity suggested by our data was specifically linked to the
economically and socially harrowing days of the last financial crisis; workers belonging to older ERTs
that formed between 1997 and 2003 told us that the intensity of their militancy and specific collective
struggles influenced their desire to practice pay equity, especially and again as a way of
counterbalancing the most exploitative practices they experienced under owner-management during
these years (pp. 81-82). On the whole, our findings here suggest that a tight, intersubjectively existential
social structure rooted in necessity and direct action, common bonds, and shared experiences permeates
ERTs that organize their work and remuneration schemes in more horizontal ways.
Responses to Intensifying Market Competition
The rise in new labour struggles in the past six years marked a change in Argentine workers
perceptions of their own plight that also influenced ERT protagonists. The era of workers deep-seated
terror of death in life, the moniker evocatively characterizing structural unemployment in Argentina,
is perceived to have been left behind by many Argentine workers. As Argentinas economy recuperated
and unemployment rates went down starting in 2003 fewer new cases of ERTs have emerged in recent
years. In its place an insipient but committed workers struggle has returned to the social stage,
increasingly challenging capital to once again improve workers living standards. In recent years,
strikes, demands for better work conditions, and struggles for union representation representation that
hundreds of thousands of Argentine workers lost during the privatization years of the 1990s have
returned (CTA, 2006). ERT workers were, in many ways, a vanguard within this new antagonistic
labour landscape. Indeed, the new imaginary of worker agency ERTs helped carve out has assisted in

30

reviving the active and grassroots political participation of workers in Argentina. But this new
conjuncture in the second era of ERTs has not been without its difficulties.
First, while the current socio-political landscape within a recomposed national economy favours
workers more than the landscape of the 1990s, the recuperation of higher levels of national economic
activity brings each ERT face-to-face with the need to recompose itself within economic sectors and
markets in full expansion (Fajn & Rebn, 2005). This means that economic success for ERTs in this
expanding capitalist system must unfold in terms conditioned by competition with companies that have
not experienced the same traumatic processes of recuperation. Moreover, these competitors have
maintained their old hierarchical management structures, capitalist labour processes, suppliers, and
customers; in sum, they have not had to confront the challenges of reconstructing their business models
around principles of self-management which adds myriad complexities to an ERTs micro-economic
situation. Similarly, ERTs must confront challenges that older or more stable cooperatives working
within the same capitalist market paradigm also usually do not have to face.
Second, while non-conventional and irregular sources of funding such as community fundraising
drives and selective government and NGO financing have helped sustain some ERTs thus far in light of
these difficulties, many ERTs still remain at a disadvantage because of the intensification of competition
within particular market sectors. Gabriel Fajn & Julin Rebn (2005), for instance, point out that the
financial precariousness undergirding some ERTs push some of them to focus primarily on generating as
much revenues as possible from the meager inputs available to them. This insecurity heightens the daily
pressures and precariousness of the particular ERT cooperative. As such, many ERT workers work with
the constant awareness that not being able to reach either established or new markets due to the lack of
productive capacity, capital investment, or raw materials necessarily means that sufficient revenues will
not be generated to pay salaries. These material difficulties underscore a large part of the daily concerns
of most ERT cooperatives. They also illustrate the main contradiction implicit in self-management
31

within a greater capitalist system: When staying afloat becomes the primary focus of and ERT it risks
losing sight of the collective spirit and democratic ideals that in part drove them to become a workers
cooperative in the first place. The resulting pressures that come with the desperate pursuit of sufficient
returns refocuses the attention of the ERT from its cooperativist possibilities back into the very capitalist
system that it contested in the first place. These economic pressures heighten the risk of reconverting the
ERT, once again, into a workspace motivated by capital accumulation and competition rather than one
rooted in communal values and a collective desire for autogestin. For Fajn and Rebn, the effects of
these challenges are reflected in the increasing trend with some ERTs to return to an organizational and
management style in tune with more capitalist norms, such as the reinstitution of fragmented and
repetitious work tasks, job intensification, overtime work without adequate compensation, and situations
where the control once exercised by the shop floor supervisor is returned in the form of the collective
foreman. As the authors point out, echoing Karl Marxs (1981) critique of cooperatives, when workers
become overwhelmed by the daunting demands of self-management, their compensatory reactions often
lead to modes of production ensconced in self-exploitation and [self]-bureaucratization (Fajn &
Rebn, 2005, p. 7).xxxiii Resorting to these exploitative tendencies in order to survive within a cutthroat
market not only risks returning the cooperative workplace to an ideology of capitalist rationality above
other values, but also as has already happened with some ERTs tempts workers to return the
cooperative to former owners, new proprietors, or for its members or workers councils to transform into
cooperativist capitalists that, once again, privilege profits above all else. In these regressive situations,
what was formerly abandoned is desired once again as workers, in essence, either give up the vision of
self-management or become new capitalists (Fajn and Rebn, 2005, p. 7).
Third, the risk of falling into the capitalist trap again also means that ERTs must carefully
consider how they will reinvest (i.e., capitalize) funds that are hard to come back into the firm. In
addition, they are faced with the need to redesign the organization of their production to most effectively
32

meet customer orders while also carefully balancing the production capabilities of the ERT, workers
democratic and egalitarian desires, and the often depleted conditions of the ERTs machinery. These
necessities require workers to learn new skills that are expensive to contract out (i.e., marketing, sales,
accounting, administration, technical, etc.). Usually, this latter need also means that an ERT must hire
new workers.
The challenges many ERTs face when they need to hire more workers serves as an illustrative
case in point here. In addition to the market and financial challenges that confound their situation, the
first barrier ERTs must face when attempting to hire new workers is Argentinas legislation for
cooperatives, which stipulates that a coops full-time hires must be incorporated as members. By
legislation, this requires probationary periods to not exceed six months. Once a new member has
become an associate (socio) of the cooperative, any subsequent decision to exclude him or her from
the coop is a long and complicated process. As such, the decision to incorporate new workers takes on a
level of gravity and consideration not needed by private companies in Argentina, which have benefited
since the Menem years from lax labour laws. In other words, ERTs that decide to incorporate new
workers must be very sure that these workers will be able to execute and maintain a level and quality of
work that will justify their salaries. Indeed, a bad hiring decision by the cooperative could, for example,
cause its already hard-to-come-by revenues to drop, possibly taking it into a crisis situation once again.
Moreover, the question of how much decision-making capacity the ERT cooperative should vest on new
workers, as well as how much they should be remunerated, remain crucial points of debate within many
ERT workers assemblies. This is in no small part related to the uncertainty that incumbent workers
have concerning a newer workers level of commitment to the ideals of cooperativism and horizontal
work processes that for many of the ERTs founding workers were formed during the long months of
occupation and struggle. Thus, new hires add to the cooperatives uncertainty concerning the future
returns on their hiring investment. xxxiv
33

These are all challenges that demand important strategic decisions that ERT workers cannot
afford to err. Despite or perhaps because of these difficulties, many ERTs have had to turn to their
members resourcefulness and invent unique ways of strengthening their work processes and skills in
light of their financial challenges by, for example, teaching themselves new skills; job rotation schemes;
collaborating with other ERTs, local universities, and even oversees NGOs to upgrade technological
capacity and skill sets (as we have already pointed out); or building networks of solidarity with the
neighbourhood and communities that surround them through, for example, community fundraising
drives, open houses, temporarily taking on interns or hiring students from local technical schools, or
raising awareness and relevance of the ERT within the local community by hosting community centres,
free schools, and free health clinics on their premises. Elsewhere we have called these initiatives the
social innovations being invented by ERTs and linked to a nascent solidarity economy being forged
by the ERT sector (Ruggeri, 2006b; Vieta, 2006a). But these innovations have been, to date, too
insipient to improve most ERTs immediate competitiveness within the intensifying capitalist markets
they find themselves in, and too far still from the level of sociotechnological adequacy required of
them to be able to compete on a level playing field with capitalist firms.xxxv

Conclusion
The previous pages have mapped two key trends that often go unnoticed by academic research
and journalistic pieces covering Argentinas worker-recovered enterprises: First, employees initial
motivations for seizing control of deteriorating companies from former owners and eventually putting
them into operation under their own self-management comes out of their fears of becoming structurally
unemployed and from their desire to save their jobs rather than from any predetermined political
predilections. Second, most ERT workers restructure their workplaces as a workers cooperative only
after workers have gained control of the plant because it is the most practical method for transforming
former owner-managed workplaces into self-managed ones. More specifically, ERT workers organize
34

themselves as a workers cooperative not from any deep-seated desire to become cooperators but, rather,
as a legal and pragmatically defensive maneuver to protect themselves from returning owners or state
repression, to legitimate themselves as a legal entity to customers and other firms in their market sector,
for more easily restructuring into horizontally democratic workspaces, and for securing market, loans,
and other forms of financing.
Fundamentally, the myriad challenges ERTs have had to maneuver around on the path to selfmanagement within their local, provincial, and national political and economic conjunctures, from the
first months of recuperation on to their unfolding struggles to stay afloat and self-manage themselves,
shape their organizational structures and mediate their ultimate success as a workers cooperative. ERT
workers capacities to put pressure on those within the juridical and political spheres of power, plus the
production and organizational innovations they manage to create, are what determine the early survival
of an ERT during its first two stages of struggle the stages that Muras MNER characterized as
occupy and resist. These two stages of struggle predominated the concerns of ERTs during the first
six tumultuous years of the phenomenon its first era between 1997-2003, the years when most
workspace occupations and seizures took place. Once these first two stages are surmounted, the third
stage produce involves experimenting with strategies of economic viability and new networks of
solidarity within and beyond each ERTs particular market sector. And all three stages towards full selfmanagement the activist (occupy), the political (resist), and economic (produce) must be
engaged with care and inventiveness in order for the cooperative to become a long-lasting experiment.
Non-partisan, pragmatically driven, and yet in many ways anti-capitalist models for transforming
work into something much more democratic and just, the ERT phenomenon can be seen in many was as
being something inspirational perhaps even something else in the history of workers struggles
despite their ongoing challenges. Ultimately, while small in numbers, ERTs are proving to be promising
micro-experiments in new forms of self-managed work practices that, collectively, are drawing out
35

tentative sketches for an alternative economic and social reality for working people in Argentina and
beyond.

36

Charts and Figures

Chart 1: Number of Cooperatives and Cooperators in Argentina, 1985 2002 (Montes & Ressel,
2003, pp. 18-19; Shaffer, 1999, p. 149)
Year
1985
1991
2002

Total cooperatives per year

4,204
8,142
16,008

Total cooperators per year

10,592,359
9,103,269
6,874,064

Chart 2: Traditional Cooperatives Per Sector and ERTs Per Sector in Argentina
Chart 2a: Traditional Cooperatives Per Sector (as of 2002) (Montes & Ressel, 2003, p. 20)
Agricultural and Livestock
Consumer
Credit
Provisioning
Insurance
Public Services
Workers Cooperatives
Housing and Construction
Others
Total

2,190
243
311
1,512
50
1,868
6,549
2,966
319
16,008

13.7%
1.5%
1.9%
9.4%
0.3%
11.7%
41.0%
18.5%
2.0%
100.0%

Chart 2b: Percentage of ERTs Per Major Sector and Per Major Region (as of 2005) (Ruggeri,
Martinez, & Trinchero, 2005, p. 40)

Metallurgical
Graphics
Textiles
Foodstuffs
Other Services
Other Manufacturers
Health
Housing and Construction
Materials
Total

City of Buenos
Greater Buenos
Aires
Aires (Province) Interior
6%
35%
29%
25%
5%
0%
13%
8%
7%
13%
11%
21%
19%
3%
21%
12%
30%
14%
13%
3%
7%
0%
100%

5%
100%

3%
100%

37

Chart 2c: Breakdown of ERTs Per Sector (as of 2003) (Fajn, 2003, p. 157)
Sector

Percentage

Metallurgical

26.4

Foodstuffs

6.9

Textiles

4.6

Mining

2.3

Paper products

3.4

Liquid gas

1.1

Ceramics /
Brickworks

3.4

Glass

4.6

Chemical products

1.1

Dairy

2.3

Printshops /
5.7
Publishing
Electronic machines 8.0
and appliances
Plastics / Rubber

2.3

Services

2.3

Education

2.3

Meat packing /
Refrigeration

8.0

Transport

5.7

Health

4.6

Water treatment
Hotels and
restaurants (tourism)
Construction
materials
Supermarkets

1.1
1.1

Total

100.00

1.1
1.1

38

Figure 1: Legal Structures of ERTs in Argentina (as of 2005) (Ruggeri, Martinez, & Trinchero, 2005,
p. 67)

Legal Structures of ERTs

1%
3%
1%
Workers' cooperative

1%

State enterprise under

worker's control
Other type of
cooperative
Still in negotiation
No legal framework as
yet

94%

Figure 2: Pay Equity and Year of Recovery of Argentine ERTs (Ruggeri, Martinez, & Trinchero,
2005, p. 80)

80%
70%
60%
50%
40%
30%
20%
10%
0%
Before 2001

2001

2002

2003-2004

Recovery year

39

Figure 3: Pay Equity Linked to Acts of Occupation or Level of Conflict in the Early Days of the ERT
(as of 2005) (Ruggeri, Martinez, & Trinchero, 2005, p. 82)

Occupied and highly conflictual ERTs

29%
Egalitarian pay
schemes
Non-egalitarian
payschemes
71%

Non-occupied or not-as-conflictual ERTs

37%

64%

Egalitarian pay
schemes
Non-egalitarian
payschemes

40

Notes
1

The findings and analyses we report in this chapter draw from the work and growing data sets emerging our of our various
and overlapping research projects that explore Argentinas ERTs.
For the past five years, Andrs Ruggeri, director of the Open Faculty program out of the University of Buenos
Airess Faculty of Philosophy and Letters, has been working with a team of anthropologists researching the ERT
phenomenon. Site visits, extensive and documented conversations with workers, and surveys of over 70 ERTs by the UBA
team have been complimented by a growing archival database of cultural artifacts, government and union policy documents,
political and economic analyses, and a growing collection of published and unpublished research on Argentinas ERTs.
Ruggeri also heads the ERT Documentation Centre that houses this archive (see: Centro de Documentacin, 2007). The
results of the first phase of this work, including the methodology used to gather the data, was reported in the 2005 book Las
empresas recuperadas en la Argentina (Ruggeri, Martinez, & Trinchero, 2005). The team also works with several ERTs,
assisting them with upgrading their technological and organizational infrastructures.
Marcelo Vieta, a PhD student in Social and Political Thought at York University in Toronto, Canada, has been
working with Ruggeris team and assisting in translating some of its writings into English since 2005. For his PhD
dissertation, Vieta is researching the cultural aspects, political history, and the phenomenology of struggle and selfmanagement undergirding Argentinas ERT phenomenon.
2

Argentinas most recent economic woes arguably began to take shape with the selling off of over 150 nationalized firms to
multinational interests in the early-1990s (ostensibly, to pay down the mounting national debt that, paradoxically, ended up
ballooning from US$58.5 billion in 1991 to US$155 billion by 2001). This policy was coupled with the fixed-rate exchange
policy (ley de convertibilidad) introduced by the Menem administration in 1991 in order to stem the tide of acute inflation
and hyperinflation that had plagued Argentina throughout much of Ral Alfonsns tenurship. While inflation was curtailed,
an overpriced peso caused exports to gradually decline throughout the 1990s. As a result, a chronic trade deficit took hold by
the middle of the decade as cheaper imports saturated local markets. Unable to do business in such an economic environment,
an escalating number of once-profitable small and medium sized businesses, faced with dwindling markets, went bankrupt
(see, in particular: Damill, 2005; Patroni, 2004; Velde & Veracierto, 2000).

By 2001, the national month-over-month business bankruptcy rate had reached its highest point in Argentinas modern
history: During the Menem/de la Rua presidencies (1989-2001), bankruptcies soared from and average of 772 per month in
1991 to over 2600 per month by 2001 (Magnani, 2003, p. 37). Consequently, by 1995 jobs were beginning to disappear in
Argentina at unprecedented speed. Moreover, the correlation between Argentinas soaring bankruptcies, the gradual
evaporation of jobs, the growing foreign debt, and, generally, the increasing entrenchment of neoliberalist economic policies,
can clearly be seen when one looks at 22 year trends in unemployment between 1980 and 2002, the same span of years that
saw the national debt balloon by 240%: According to Argentinas Ministry of Labour, the official unemployment rate in 1980
was 1.9%. By 1989, at the height of hyperinflation, the official unemployment rate had risen to 7.6%. By 1994 it had hit the
two-digit mark for the first time in decades, coming in at 11.5%. Between 1995 and 2001, it was averaging 15.6%. And by
2002, at the height of the financial crisis, the official unemployment rate had hit 19.7% of Argentinas working population.
Unofficial estimates, however, pegged the actual rate of unemployment at the time at well over 20%, while some unofficial
analyses estimated it at more than 35% (Mura, 2005) or even 40% (Colombo & Bril-Mascarenhas, 2003, p. 458). It is also
interesting to note that by 1993, during the heady years of Menems market liberalization reforms, the official unemployment
rate surpassed the official under-employment rate for the first time. This remained the case right up till the economic collapse
of 2001-2002 (Ministerio de Trabajo, 2006).
4

As Chart 2a indicates, a large number of Argentinas cooperatives (59%) belong to either the rural, housing, insurance,
consumer, public services, and credit sectors, rather than in the economic sectors where most ERTs are to be found. To date,
most ERTs have come from urban economic sectors most affected by the implosion of the neoliberal model of the 1990s,
which include: urban industrial sectors or service sectors that deal with intermediary production (i.e., graphics, metal works,
food processing, etc.) or final consumption (i.e., editorial houses, schools, hotels, etc.) (Ruggeri, Martinez, Trinchero, 2005,
p. 47; Fajn, 2003, p. 157; Una Argentina Solidaria, 2004).
5

National Movement of Recovered Enterprises.

National Movement of Worker-Recovered Factories.

In Argentinas bankruptcy law (article 21 of law 25.589) stipulates the following concerning employee ownership of a
failed firm: the continuity of the enterprise [in the case of bankruptcy] will consider the formal requests of its employees in

41

their dependency, or as labour creditors, who must act in the subsequent period of continuity under the form of a workers
cooperative (http://infoleg.mecon.gov.ar/infolegInternet/anexos/70000-74999/74331/norma.htm) (see also, Mart et al, 2004,
p. 104).
8

Such was the case, for example, with the workers of the Unin Solidaria de Trabajadores workers cooperative (Solidarity
Union of Workers, or UST), which was formally a branch of Argentinas largest homegrown multinational, Techint. The
UST workers were fractured from the company and repositioned as a cooperative and as independent contractors in 2000.
Soon after Techint began to outsource the work once done within the company to the cooperativized former branch-plant
workers their job-orders became unwieldy as their production costs began to surge and unremunerated overtime became the
norm, now without union representation. In 2001, the UST workers occupied the plant, reconstituted their cooperative under
the rubric of an ERT, sought expropriation, and have now formed into a thriving ERT in the municipality of Avellaneda. For
an account of their struggle, see: Clemente (2007) and Como surge nuestra cooperativa? (2006).
9

National Association of Workers of Self-Managed Enterprises.

10

The Unique Workers Central.

11

Federation of Productive Cooperatives of Uruguay.

12

Revolutionary Front of Enterprises Co-managed and Occupied by Workers.

13

Of the 75 accords that were signed at the First Encounter of Recovered Enterprises in Caracas Venezuela in October 2005,
59 Argentine ERTs signed 39 accords. Venezuelan ERTs signed 26 accords, and the other 10 accords were signed by ERTs
from the other countries.

14

The Bolivarian Alternative for Latin America and the Caribbean.

15

While Chile, Bolivia, and Perus experiences with nationalized co-management showed early promises for workers
control in these countries, Petras & Veltmeyer (2003) theorize that they ultimately failed due not only to the eventual collapse
of their national regimes, but also to the marked separations between the quotidian needs of workers on shop floors and real
managerial power which rested in the hands of the state. In these scenarios, the authors go on to explain, workers were not
sufficiently ensconced in the apparatuses of state power to avoid the bourgeois classes from eventually recovering their
industrial control, often with the armed forces at their side (El Diario de Guyana, 2005).
16

General Confederation of Labour.

17

A big part of these internal conflicts involve differing opinions amongst its leadership regarding what kind of role MNER
is to play now that the national economy has stabilized somewhat. While Mura, for example, continues to believe in an
antagonistically combative posture towards the state and advocates fighting for a different Argentina, an Argentina without
exploitation (Mura, 2006), others within MNER feel that a more conciliatory role towards the state and the Kirchner
administration should be taken up.

18

The split between MNER and MNFRT was due to various internal conflicts that revolved around ideological issues (e.g.,
MNERs desire for the basic autonomy of each ERT vs. MNFRTs more traditional union-like approach), strategies of how
to deal with the state, and, in particular, whether or not community centres should be opened within ERTs. MNER tended to
operate more autonomously, but consequently also more chaotically, than MNFRT. It aligned itself closely with the global
social justice movements and the World Social Forum and tended to also distance itself as much as it practically could from
the state while, at the same time, lobbying the state for strategic subsidies (e.g, pensions, funds for technical upgrading,
funding for cultural centres, etc.). It also lobbied hard for reforming certain laws that would ease an ERTs legal burdens,
seeking, for example, amendments to the law of bankruptcy to favour worker takeovers without having to face the financial
burdens left by former owners and the law of expropriation. MNER was also instrumental in lobbying regional legislatures to
reinterpret Argentinas national law of expropriation. As a further protective strategy and as a way of giving back to the
community, MNER also actively encouraged ERTs to open up community centres and other community-based initiatives
within their premises, proactively supporting those ERTs that interacted openly with the neighbourhoods that surround them.
Differentiating itself from MNER politically and ideologically, MNFRT, encourages its worker-recovered
cooperatives not to open community services for fear that such activity would detract from the business efforts of the workerrun firm. At times, MNFRT also works more closely with the state and it is not as anti-government as some MNER leaders

42

are. It also advocates changing certain laws to favour ERTs: in particular, like MNER, it too desires to alter the bankruptcy
laws so that workers would be paid back the totality of salaries, benefits, etc. owing to them first.
For detailed accounts of the history of these conflicts and the various ideological differences between Eduardo
Muras MNER and Luis Caros MNFRT, see: Heller (2004), Lavaca (2004), Magnani (2003), and Rebn & Saavedra
(2006).
19

Tellingly, some ERTs decide to open up their factories and workspaces to the community and offer it free spaces from
which to facilitate community centres, popular schools, medical clinics, theatres, and art galleries specifically in response to
this support and solidarity that many barrio neighboours, friends, and family members showed agitating ERT workers during
their most risky days of occupation.
20

Argentine Federation of Self-Managed Workers Cooperatives.

21

This would be the Unin Obrera Metalrgica de Quilmes (Metallurgic Workers Union of Quilmes, or UOM Quilmes).

22

That these two initiatives rely on European funding and technical assistance also alludes to the Argentine federal
governments general indifference towards ERTs.

23

Federation of Workers Cooperatives of the Province of Buenos Aires.

24

National Association of Self-Managed Workers.

25

Central of Argentine Workers.

26

Organizing Institute for Cooperative Funds.

27

MNERs and MNFRTs persistent lobbying for redrawing these national laws consequently saw regional and national
legislatures and the juridical establishment begin to reconsider these laws in light of the possibilities that the ERT solution
offers for curbing rising unemployment rates (Ruggeri, 2006).

28

Occupy, Resist, Produce was adopted by MNER from the slogan of the landless peasant movements of Brazil (Mura,
2005).

29

If all goes well with the occupation or seizure of the plant and the early months of self-managed production and there are
no guarantees that things will the process of workplace recovery culminates in the firm becoming an official, worker-run
cooperative, fully controlled by its workers under the legal protection of a temporary or permanent version of the ley de
expropiacin (the law of expropriation) and Argentinas legislation covering cooperatives. The law of expropriation found in
article 17 of the Argentine constitution which the legislative branches of local governments began to interpret in favour of
workers cooperatives primarily because of the lobbying efforts of ERT umbrella organizations such as MNER and MNFRT
and the legal arguments of their lawyers is vitally important to ERTs because it prevents the auctioning off of the failing
companys assets and, together with article 21 of law 25.589 (see footnote 7), gives the workers cooperative partial or total
control of the plant and its assets for a specific period of time. Before definitive expropriation is approved, worker-recovered
workspaces are usually granted a two to five year window to operate the firm under a supplementary law of temporary
expropriation. Temporary expropriations, however, are usually granted after much lobbying and are never guaranteed. With
this provisional legal status, ERTs are ensured only temporary control of machines, trademarks, patents, and real estate while
the case for definitive expropriation is being heard in courts and regional legislatures. Workers cooperatives that have been
granted temporary expropriation must continue their struggles with the regional political establishment in order to secure the
permanent law of expropriation for their firm (Magnani, 2003; Palomino, 2003).

30

Well-known cases of these long struggles that included public lobbying tactics and standoffs with the police have garnered
an impressive amount of press coverage. The most notable cases include the printing houses Artes Grficas Chilavert and
Artes Grficas Patrcios, the Brukman clothing factory, the ceramic factory Zann/FaSinPat, and the Hotel BAUEN.
31

The mean number of workers making up an ERT in Argentina is around 35, which, as a side note, tends to be a massive
drop in their personnel from an average of 180 employees per company when it was under owner-management (Ruggeri,
Martinez, & Trinchero, 2005). A depleted workforce is also reflective of the dilapidated conditions of most recovered
companies during the days of occupation and the first months of production as an ERT. Most of the absent workers are made

43

up of employees that either did not want to go along with the occupation, retired early, or, most likely, were part of the
management, administrative, or technical teams that had an easier time finding work elsewhere (Fajn, 2003).
32

Allocating a percentage of revenues to community initiatives such as neighbourhood athletic clubs, neighbourhood
kitchens, barrio microenterprises, or other local infrastructural needs is a practice which some ERTs have adopted in light of
the solidarity given to them by the neighborhoods that surround them and usually in the most economically challenged
barrios. Not all ERTs are inclined to such practices, however. Some notable cases of ERTs allocating a certain percentage of
their monthly revenues to community initiatives include Arts Grficas Chiulavert in the economically challenged Nueva
Pompeya barrio of the city of Buenos Aires, Cooperativa UST in the southern Buenos Aires municipality of Avellaneda, and
Zann in the privince of Nequn (Centro de Documentacin, 2007).
33

See, in particular: Marx (1981, p. 571) and McNally (1993, pp. 184-188).

34

Whats more, the period of member/worker expansion adds an additional long-term worry for the ERT: If the number of
new associates supercedes the number of founding members of the coop, could the cooperative be voted out of existence
one day and become, once again, a capitalist firm perceived by newer members to be a much more efficient model for
securing their jobs and tackling capitalist markets? Due to these risks, and the related internal conflicts that have actually
arisen in various ERTs to date between founding members and new members of the cooperative, many ERT coops have
decide to incorporate new workers as temporary contract workers without making them members of the cooperative. At times
these contracts are renewed far beyond the six-month probationary period that they would have had to respect had they taken
on these contract workers as outright members of the cooperative. Ironically, these situations tend to reproduce the very
capitalist practices that led to the labour instability that ERT protagonists were contesting in the first place. Nevertheless, in
some ERTs, there is a deep preoccupation with balancing the equitable treatment of all workers, be they founding members
or newer members, while, at the same time, somehow not putting the long-term viability of the cooperative and the internal
equilibrium of the organizational and production processes at risk. In these cases this balance seems to be maintained by
giving priority to the practice of hiring family members, ex-workers of the cooperative (including retired workers), or
workers recommended to them by friends (Ruggeri, Martinez, & Trinchero, 2005).

35

Amongst others, Renato Dagnino and Henrique Novaes, investigators at the University of Campinas have, in various texts,
attempted to work through the concept of socio-technological fit in relation to ERTs (see, for example: Dagnino & Novaes,
2004).

44

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i The findings and analysis we report in this chapter draw from the work and growing data sets emerging our of our various and overlapping research projects that explore Argentinas ERTs.
For the past five years, Andrs Ruggeri, director of the Open Faculty program out of the University of Buenos Airess Faculty of Philosophy and Letters, has been working with a team of anthropologists researching the ERT phenomenon. Site visits, extensive and documented conversations with workers, and surveys of over 70 ERTs by the UBA team have been complimented by a growing archival database of cultural artifacts, government and union policy documents, political and economic analyses, and a growing collection of published and unpublished research on Argentinas ERTs. Ruggeri also heads the ERT Documentation Centre that houses this archive (see: Centro de Documentacin, 2007). The results of the first phase of this work, including the methodology used to gather the data, was reported in the 2005 book Las empresas recuperadas en la Argentina (Ruggeri, Martinez, & Trinchero, 2005). The team also works with several ERTs, assisting them with upgrading their technological and organizational infrastructures.
Marcelo Vieta, a PhD student in Social and Political Thought at York University in Toronto, Canada, has been working with Ruggeris team and assisting in translating some of its writings into English since 2005. For his PhD dissertation, Vieta is researching the cultural aspects, political history, and the phenomenology of struggle and self-management undergirding Argentinas ERT phenomenon.
ii Argentinas most recent economic woes arguably began to take shape with the selling off of over 150 nationalized firms to multinational interests in the early-1990s (ostensibly, to pay down the mounting national debt that, paradoxically, ended up ballooning from US$58.5 billion in 1991 to US$155 billion by 2001). This policy was coupled with the fixed-rate exchange policy (ley de convertibilidad) introduced by the Menem administration in 1991 in order to stem the tide of acute inflation and hyperinflation that had plagued Argentina throughout much of Ral Alfonsns tenurship. While inflation was curtailed, an overpriced peso caused exports to gradually decline throughout the 1990s. As a result, a chronic trade deficit took hold by the middle of the decade as cheaper imports saturated local markets. Unable to do business in such an economic environment, an escalating number of once-profitable small and medium sized businesses, faced with dwindling markets, went bankrupt (see, in particular: Damill, 2005; Patroni, 2004; Velde & Veracierto, 2000).
iii By 2001, the national month-over-month business bankruptcy rate had reached its highest point in Argentinas modern history: During the Menem/de la Rua presidencies (1989-2001), bankruptcies soared from and average of 772 per month in 1991 to over 2600 per month by 2001 (Magnani, 2003, p. 37). Consequently, by 1995 jobs were beginning to disappear in Argentina at unprecedented speed. Moreover, the correlation between Argentinas soaring bankruptcies, the gradual evaporation of jobs, the growing foreign debt, and, generally, the increasing entrenchment of neoliberalist economic policies, can clearly be seen when one looks at 22 year trends in unmployment between 1980 and 2002, the same span of years that saw the national debt balloon by 240%: According to Argentinas Ministry of Labour, the official unemployment rate in 1980 was 1.9%. By 1989, at the height of hyperinflation, the official unemployment rate had risen to 7.6%. By 1994 it had hit the two-digit mark for the first time in decades, coming in at 11.5%. Between 1995 and 2001, it was averaging 15.6%. And by 2002, at the height of the financial crisis, the official unemployment rate had hit 19.7% of Argentinas working population. Unofficial estimates,
however, pegged the actual rate of unemployment at the time at well over 20%, while some unofficial analyses estimated it at more than 35% (Mura, 2005) or even 40% (Colombo & Bril-Mascarenhas, 2003, p. 458). It is also interesting to note that by 1993, during the heady years of Menems market liberalization reforms, the official unemployment rate surpassed the official under-employment rate for the first time. This remained the case right up till the economic collapse of 2001-2002 (Ministerio de Trabajo, 2006).
iv As Chart 2a indicates, a large number of Argentinas cooperatives (59%) belong to either the rural, housing, insurance, consumer, public services, and credit sectors, rather than in the economic sectors where most ERTs are to be found. To date, most ERTs have come from urban economic sectors most affected by the implosion of the neoliberal model of the 1990s, which include: urban industrial sectors or service sectors that deal with intermediary production (i.e., graphics, metal works, food processing, etc.) or final consumption (i.e., editorial houses, schools, hotels, etc.) (Ruggeri, Martinez, Trincher, 2005, p. 47; Fajn, 2003, p. 157; Una Argentina Solidaria, 2004).
v National Movement of Recovered Enterprises.
vi National Movement of Worker-Recovered Factories.
vii In Argentinas bankruptcy law (article 21 of law 25.589) stipulates the following concerning employee ownership of a failed firm: the continuity of the enterprise [in the case of bankruptcy] will consider the formal requests of its employees in their dependency, or as labour creditors, who must act in the subsequent period of continuity under the form of a workers cooperative (http://infoleg.mecon.gov.ar/infolegInternet/anexos/70000-74999/74331/norma.htm) (see also, Mart et al, 2004, p. 104).
viii Such was the case, for example, with the workers of the Unin Solidaria de Trabajadores workers cooperative (Solidarity Union of Workers, or UST), which was formally a branch of Argentinas largest homegrown multinational, Techint. The UST workers were fractured from the company and repositioned as a cooperative and as independent contractors in 2000. Soon after Techint began to outsource the work once done within the company to the cooperativized former branch-plant workers their job-orders became unwieldy as their production costs began to surge and unremunerated overtime became the norm, now without union representation. In 2001, the UST workers occupied the plant, reconstituted their cooperative under the rubric of an ERT, sought expropriation, and have now formed into a thriving ERT in the municipality of Avellaneda. For an account of their struggle, see: Clemente (2007) and Como surge nuestra cooperativa? (2006).
ix National Association of Workers of Self-Managed Enterprises.
x The Unique Workers Central.
xi Federation of Productive Cooperatives of Uruguay.
xii Revolutionary Front of Enterprises Co-managed and Occupied by Workers.
xiii Of the 75 accords that were signed at the First Encounter of Recovered Enterprises in Caracas Venezuela in October 2005, 59 Argentine ERTs signed 39 accords. Venezuelan ERTs signed 26 accords, and the other 10 accords were signed by ERTs from the other countries.
xiv The Bolivarian Alternative for Latin America and the Caribbean.

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xv While Chile, Bolivia, and Perus experiences with nationalized co-management showed early promises for workers control in these countries, Petras & Veltmeyer (2003) theorize that they ultimately failed due not only to the eventual collapse of their national regimes, but also to the marked separations between the quotidian needs of workers on shop floors and real managerial power which rested in the hands of the state. In these scenarios, the authors go on to explain, workers were not sufficiently ensconced in the apparatuses of state power to avoid the bourgeois classes from eventually recovering their industrial control, often with the armed forces at their side (El Diario de Guyana, 2005).
xvi General Confederation of Labour.
xvii A big part of these internal conflicts involve differing opinions amongst its leadership regarding what kind of role MNER is to play now that the national economy has stabilized somewhat. While Mura, for example, continues to believe in an antagonistically combative posture towards the state and advocates fighting for a different Argentina, an Argentina without exploitation (Mura, 2006), others within MNER feel that a more conciliatory role towards the state and the Kirchner administration should be taken up.
xviii The split between MNER and MNFRT was due to various internal conflicts that revolved around ideological issues (e.g., MNERs desire for the basic autonomy of each ERT vs. MNFRTs more traditional union-like approach), strategies of how to deal with the state, and, in particular, whether or not community centres should be opened within ERTs. MNER tended to operate more autonomously, but consequently also more chaotically, than MNFRT. It aligned itself closely with the global social justice movements and the World Social Forum and tended to also distance itself as much as it practically could from the state while, at the same time, lobbying the state for strategic subsidies (e.g, pensions, funds for technical upgrading, funding for cultural centres, etc.). It also lobbied hard for reforming certain laws that would ease an ERTs legal burdens, seeking, for example, amendments to the law of bankruptcy to favour worker takeovers without having to face the financial burdens left by former owners and the law of expropriation. MNER was also instrumental in lobbying regional legislatures to reinterpret Argentinas national law of expropriation. As a further protective strategy and as a way of giving back to the community, MNER
also actively encouraged ERTs to open up community centres and other community-based initiatives within their premises, proactively supporting those ERTs that interacted openly with the neighbourhoods that surround them.
Differentiating itself from MNER politically and ideologically, MNFRT, encourages its worker-recovered cooperatives not to open community services for fear that such activity would detract from the business efforts of the worker-run firm. At times, MNFRT also works more closely with the state and it is not as anti-government as some MNER leaders are. It also advocates changing certain laws to favour ERTs: in particular, like MNER, it too desires to alter the bankruptcy laws so that workers would be paid back the totality of salaries, benefits, etc. owing to them first.
For detailed accounts of the history of these conflicts and the various ideological differences between Eduardo Muras MNER and Luis Caros MNFRT, see: Heller (2004), Lavaca (2004), Magnani (2003), and Rebn & Saavedra (2006).
xix Tellingly, some ERTs decide to open up their factories and workspaces to the community and offer it free spaces from which to facilitate community centres, popular schools, medical clinics, theatres, and art galleries specifically in response to this support and solidarity that many barrio neighboours, friends, and family members showed agitating ERT workers during their most risky days of occupation.
xx Argentine Federation of Self-Managed Workers Cooperatives.
xxi This would be the Unin Obrera Metalrgica de Quilmes (Metallurgic Workers Union of Quilmes, or UOM Quilmes).
xxii That these two initiatives rely on European funding and technical assistance also alludes to the Argentine federal governments general indifference towards ERTs.
xxiii Federation of Workers Cooperatives of the Province of Buenos Aires.
xxiv National Association of Self-Managed Workers.
xxv Central of Argentine Workers.
xxvi Organizing Institute for Cooperative Funds.
xxvii MNERs and MNFRTs persistent lobbying for redrawing these national laws consequently saw regional and national legislatures and the juridical establishment begin to reconsider these laws in light of the possibilities that the ERT solution offers for curbing rising unemployment rates (Ruggeri, 2006).
xxviii Occupy, Resist, Produce was adopted by MNER from the slogan of the landless peasant movements of Brazil (Mura, 2005).
xxix If all goes well with the occupation or seizure of the plant and the early months of self-managed production and there are no guarantees that things will the process of workplace recovery culminates in the firm becoming an official, worker-run cooperative, fully controlled by its workers under the legal protection of a temporary or permanent version of the ley de expropiacin (the law of expropriation) and Argentinas legislation covering cooperatives. The law of expropriation found in article 17 of the Argentine constitution which the legislative branches of local governments began to interpret in favour of workers cooperatives primarily because of the lobbying efforts of ERT umbrella organizations such as MNER and MNFRT and the legal arguments of their lawyers is vitally important to ERTs because it prevents the auctioning off of the failing companys assets and, together with article 21 of law 25.589 (see footnote 7), gives the workers cooperative partial or total control of the plant and its assets for a specific period of time. Before definitive expropriation is approved, worker-recovered workspaces are usually granted a two to five year window to operate the firm under a supplementary law of temporary expropriation.
Temporary expropriations, however, are usually granted after much lobbying and are never guaranteed. With this provisional legal status, ERTs are ensured only temporary control of machines, trademarks, patents, and real estate while the case for definitive expropriation is being heard in courts and regional legislatures. Workers cooperatives that have been granted temporary expropriation must continue their struggles with the regional political establishment in order to secure the permanent law of expropriation for their firm (Magnani, 2003; Palomino, 2003).
xxx Well-known cases of these long struggles that included public lobbying tactics and standoffs with the police have garnered an impressive amount of press coverage. The most notable cases include the printing houses Artes Grficas Chilavert and Artes Grficas Patrcios, the Brukman clothing factory, the ceramic factory Zann/FaSinPat, and the Hotel BAUEN.
xxxi The mean number of workers making up an ERT in Argentina is around 35, which, as a side note, tends to be a massive drop in their personnel from an average of 180 employees per company when it was under owner-management (Ruggeri, Martinez, & Trinchero, 2005). A depleted workforce is also reflective of the dilapidated conditions of most recovered companies during the days of occupation and the first months of production as an ERT. Most of the absent workers are made up of employees that either did not want to go along with the occupation, retired early, or, most likely, were part of the management, administrative, or technical teams that had an easier time finding work elsewhere (Fajn, 2003).
xxxii Allocating a percentage of revenues to community initiatives such as neighbourhood athletic clubs, neighbourhood kitchens, barrio microenterprises, or other local infrastructural needs is a practice which some ERTs have adopted in light of the solidarity given to them by the neighborhoods that surround them and usually in the most economically challenged barrios. Not all ERTs are inclined to such practices, however. Some notable cases of ERTs allocating a certain percentage of their monthly revenues to community initiatives include Arts Grficas Chiulavert in the economically challenged Nueva Pompeya barrio of the city of Buenos Aires, Cooperativa UST in the southern Buenos Aires municipality of Avellaneda, and Zann in the privince of Nequn (Centro de Documentacin, 2007).
xxxiii See, in particular: Marx (1981, p. 571) and McNally (1993, pp. 184-188).
xxxiv Whats more, the period of member/worker expansion adds an additional long-term worry for the ERT: If the number of new associates supercedes the number of founding members of the coop, could the cooperative be voted out of existence one day and become, once again, a capitalist firm perceived by newer members to be a much more efficient model for securing their jobs and tackling capitalist markets? Due to these risks, and the related internal conflicts that have actually arisen in various ERTs to date between founding members and new members of the cooperative, many ERT coops have decide to incorporate new workers as temporary contract workers without making them members of the cooperative. At times these contracts are renewed far beyond the six-month probationary period that they would have had to respect had they taken on these contract workers as outright members of the cooperative. Ironically, these situations tend to reproduce the very capitalist practices that led to the labour instability that ERT protagonists were contesting in the first place. Nevertheless, in some ERTs, there is a deep preoccupation with balancing the equitable treatment of all workers, be they founding members or newer members,
while, at the same time, somehow not putting the long-term viability of the cooperative and the internal equilibrium of the organizational and production processes at risk. In these cases this balance seems to be maintained by giving priority to the practice of hiring family members, ex-workers of the cooperative (including retired workers), or workers recommended to them by friends (Ruggeri, Martinez, & Trinchero, 2005).
xxxv Amongst others, Renato Dagnino and Henrique Novaes, investigators at the University of Campinas have, in various texts, attempted to work through the concept of socio-technological fit in relation to ERTs (see, for example: Dagnino & Novaes, 2004).

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