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ESPANOL: El Salvador and surge in privatization push
ARENA SACKING THE STATE
Since 11 September the ARENA government, in conjuncture with
international financial institutions, particularly the World Bank and the
Inter-American Development Bank, has been on an accelerated path to strip
the State of its most valuable sectors and turn them over for private
profit. The events of 11 September have facilitated this process.
Apparently, the goal seems to be twofold: 1) transfer key and profitable
sectors, including their infrastructure, to private hands for their
profit; and 2) leave the State without any way to generate income and
powerless to make profound changes without a fierce and long battle. A
key element in achieving their goal is the elimination of the unions that
oppose such neo-liberal plans. The government's plan appears to be to
attack and dismantle the Union Federation of Public Service Workers of El
Salvador (FESTRASPES), thus establishing a clear run at privatization.
Below is a brief update and analysis on the process in each sector.
EDUCATION11 This section of the article is based on an interview with
Rafael Coto, ANDES, Dec. 2001.
The privatization attack strategy in the educational sector can be seen
on three fronts: 1) voluntary leave; 2) the World Bank program "Educo";
and 3) the aggressive privatization process of the two of the leading and
most respected public high schools.
Voluntary leave was started by then-President Christiani in 1991 as one
of the first steps in "reducing the state". The program was designed to
eliminate teachers by giving incentives to those teachers who had 20-30
years teaching experience so they would leave their jobs. The initial
goal was then to "freeze" the position and not hire another teacher.
However, because of popular pressure from unions and the absurdity of
eliminating teachers when almost a third of the country (over 15 years of
age) was illiterate (according to official statistics and about a
million children did not attend school because of lack of opportunity)
the government backed down and exempted health and education from the
"freeze" plan. The government then settled for not having to pay
teachers on the upper-end pay scale and instead replacing them with new
teachers.
The World Bank funded program known as "Educo" is another key program in
the privatization plan. While the World Bank and the Salvadoran
government boast that World Bank money goes to improve education, their
hidden agenda is to dismantle the public education system. The money is
destined for teachers in the rural areas; however, the money is not
channeled through the Ministry of Education and the teachers are neither
salaried teachers nor part of the permanent public system. At the end of
this year ANDES (national teachers union) estimates that 3,000 to 4,000
teachers in this program will be released. There is, then, a program
whose aim is to reduce the public system and a complementary program,
based on debt, where the aim is to utilize and build a system based on
"flexible" teachers (without job security or many benefits) outside the
public realm.
The government is also taking steps to privatize the nation's two leading
public high schools, INFRAMEN and Centro Escolar de Commercio. According
to Rafael Coto of ANDES, it is in the plans of the Ministry of Education
to privatize through "partnerships" with banks. In such plan, the
schools depend on funding from private banks. However, the banks in
turn, impose their will over the institutions.
Furthermore, the historic and well-respected University of El Salvador
(UES) is under attack. The goal is to create discontent and
unfunctionabilty so that the university can be privatized.22 Statistics in
this paragraph taken from speech given by Dr. María de Rodríguez, Rector
of the UES, at a conference organized by the FMLN. In 1980, 3.5% of
the national budget went the UES. During the war the military bombed the
University's buildings, burned laboratories, libraries and other
equipment and not one- cent has ever been allocated to the UES for
reconstruction after these crimes. In 2001, 1.7% of the budget went to
the UES and the executive's proposal for 2002 is a shocking 0.8%. In
comparison, Costa Rica gives 6% to their public university. With this
allocation the executive government is consciously condemning the UES to
deficit and instability.
HEALTH CARE33 Section based on interviews with Lilian Castro (STISSS) and
Dr. Magda (Colegio Médico) in addition to articles in La Prensa Gráfica
and Diario de Hoy.
Since the new director of the ISSS (Salvadoran Social Security Institute,
public health care) took over in June 2001, 71 workers have been fired,
mostly members the union, STISSS. Based on meetings with administration,
the union is anticipating around 2,000 firings in January. The target
areas are maintenance, security and custodial positions.
Currently the government is allocating a suffocating 1.8% of the GDP to
the Ministry of Public Health in an effort to reduce the State's
responsibility in providing health care for its citizens. The Ministry
of Public Health would need an increase of 94% in order provide
sufficient service to the population. In addition, the "Concessions Law"
was recently passed by the Right block in the Legislative Assembly, which
helps pave the way for the privatization of health. The law was based on
the ANEP's (National Association of Private Business) suggestions
provided in the "Reforma del Sector de Salud" (Health Sector Reform).
The STISSS and Colegio Medico have published an alternative proposal that
contains the following observations:
Due to restricting budget workers are not able to perform their duties
adequately because of lack of medicine and equipment
The ISSS should expand to the rural area: only 16% of the population has
access to ISSS
Funding for the Ministry of Public health needs to be increased by almost
100%
There are problems of corruption and lack of regulation of medicine
However, judging on past and present experience, health care workers will
not give up. In a speech given at the budget forum organized by the
FMLN, Dr. Magda stated that they are tired of signing agreements with the
government (in 1998 they signed an agreement with the government which
stated that no aspect of the public health system would be privatized)
because the executive government never respects the accords. He
affirmed, now, they will start a new struggle.
WATER
The Inter-American Development Bank (IDB) and ARENA are setting the
groundwork for the privatization of water through a loan from the IDB.
The loan was signed in October 2001 and currently the Legislative
Assembly must approve the conditions, which will allow the first
disbursement of the loan.
In order to receive these disbursements, the Assembly must approve the
legal framework to comply with the conditions. In order to receive the
first disbursement, the condition was to have presented a
"decentralization" strategy based on the IDB guidelines.
In an article written by José Antonio Morales Carbonell in the 13
December Co Latino, he states, "The three fundamental elements of the
said strategy are: the possible concession of the large systems or group
of systems to private operating companies, the deconcentration of ANDA
(public water company) and the decentralization of the small municipal
systems actually operated by ANDA..." He continues: "decentralization
meaning 'transferring the administration and operation of a system of
potable water or a group of small municipal systems to a independent
company with private standing formed by the municipality or association
of municipal users and preferably with the participation of the private
sector, with or without lucrative ends.'"
According to Oscar Bolaños from SETA (state water company union) and head
of FESTRASPES (Union Federation of Public Service Workers of El Salvador)
the union is anticipating around 1,000 firings in January. In addition,
the union leader also made evident that there are French and Spanish
companies interested in the water system and they are only waiting for
the establishment of a legal framework to protect their interests.44
Meeting with Oscar Bolaños, Dec. 14, 2001.
PORTS
In September, under the guise of the "war on terrorism", 154 airport
workers were "laid off for 9 months" at gun point.55 For a history of the
case see CIS Action Alert, October, 2001. Owing to the conditions of
poverty, 75 workers have accepted the government severance pay; thereby
accepting that his is no layoff but rather enforced redundancy.
Furthermore, workers had taken out loans to rebuild their homes after the
earthquakes and now they are being threatened by the banks. In order not
to immediately lose their homes they were manipulated into accepting
the severance pay. According to Joaquín Campos, General Secretary of
SITEAIES (the airport worker's union), the government (in conjecture with
private enterprise) strategy is to use the war on terrorism as an excuse
to lay off workers, primarily from the union, for 9 months because of
"security reasons" then force them into accepting their offer to be
"voluntarily let go". This way, they can say they have not "fired"
anyone, dismantle the union and have a smooth shot at privatization.
Immediately, the two strategic areas to privatize are cargo and security.
With the preparation of Plan Puebla Panama and the Free Trade Area of the
Americas (FTAA), private interests have their eyes on Port of Acajutla so
as to reap the profit from the foreseen "free trade". According to the
Salvadoran Port Industry Union (SIPES), those behind the privatization
process and with interests in the Port are none other than: 1) Alfredo
Cristiani, ex- president of El Salvador and owner of Banco Cuscatlan; 2)
Ricardo Montenegro of UNIFERSA (involved in the loss of fertilizer
donated by the Japanese government); and 3) Leonel Mejía, President of
ALCASA and the Simán Consortium. In order to achieve the privatization
of the Port of Acajutla the government has initiated a defamatory
campaign against SIPES. It has placed expensive advertisements on
television and radio stating that the port is on verge of collapsing
because of the worker's excessive demands and salaries. Ruy César
Miranda, President of the Autonomous Port Executive Commission (CEPA),
claims there are million colon losses owing to the "operative system".66
La Prensa Gráfica, Dec. 10, 2001, Pg. 48. However, César Zelidón, SIPES
representative, has pointed out that the yearly port records, dating from
1998-2000, presented to the Legislative Assembly contain no evidence of
the millions in losses. He also pointed out that CEPA's annual spending
is ¢33.8 million colones (CEPA includes the International Airport of El
Salvador, the Port of Cutuco and the Port of Acajuta, among others) and
of that amount, ¢11.5 million goes to 52 executives.77 Co Latino Dec. 3,
2001, Pg. 2. Ruy Miranda himself earns ¢40,000 colones a month. The
union representative also pointed out that the port, in its nature, is
profitable. He adds, "How is it possible that in 1998 President Armando
Calderón Sol declared that Acajutla was profitable and one of the most
modern ports in Central America and the following year they say not any
more...?"88 Co Latino, Dec. 3, 2001, Pg. 2. The union states that the
current problems with the port are owing to its administration.
Particularly, it points to the administrative salaries and to corruption.
For example, the union claims there are some barges that have special
privileges and pay discounted rates.99 La Prensa Gráfica, Dec. 10, 2001,
Pg. 48.
As predicted, the privatization of profitable public sectors (and other
neo-liberal measures) has left the State with insufficient money to cover
its budget and further "cut backs" are necessary. Further cut backs and
"concessions" means less income, which means more dependency on loans and
fewer social services (basic human rights). And the deadly cycle
continues. The global and national elite along with the international
financial institutions make out like bandits on the misery of the masses,
but the chickens might come home to roost as the deficit created by
ARENA continues to grown and the economy continues to sink.
--
Dan Bell
International Program Coordinator
Ohio Employee Ownership Center
Kent State University
Kent, OH 44242
(330) 672-0333 << Direct number!
(330) 672-3028 general office number
(330) 672-4063 fax
dbell@kent.edu
http://www.kent.edu/oeoc/
http://cog.kent.edu
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