“It’s the happiest day for fans of Club Comunicaciones. We have been fighting for this for 12 years,” explains club member Rodrigo Veiga. “If we work together we can get rid of the $12m debt and have the club back.”

He is talking about how on 21st August the Court of Appeals reversed the ruling that had sealed the sale of the club to the Truck Drivers’ Union, who, with an offer of $52m, had been the highest bidder vying for the bankrupt club. As a result, the club has three more years to clear its debts and remain in the hands of the members, who have been given a month to present a bailout plan.

The entrance to Club Comunicaciones covered by signs. (Photo: Diego Espinosa)

Roberto Ruiz is another of the hundreds of members who have worked to save Comunicaciones from being sold. He passionately talks of the plans and the work that he thinks will be necessary for this resurrection.

While he talks, I think of the 17-hectare block, valued at more than US$160m, which the club owns in Buenos Aires. There is a lot to be done, the signs of abandonment can be seen all around.

But at last, there are no more judges, no bankruptcy – just children; a lot of children running and playing football in the middle of the roller hockey fields, others just chatting under a tree, and beyond them a sign expressing what was simply a wish, but has now become a reality ‘Comu is not for sale’.

The ruling shows how the privatisation of sporting entities has been resisted in Argentina, privileging the social role that they fulfil. It has also highlighted the fundamental role the members have played in all this process, the regular people who, when they organise and mobilise, can change things.

A Common Good

In Argentina, the vast majority of sporting clubs are still Asociaciones Civiles, or unincorporated, non-profit associations. This used to be the norm in other parts of the world too, which now see economic groups and media corporations, as well as oligarchs and sheikhs, buy up clubs in Europe and North America.

The objective of an Asociación Civil is the realisation of a common good – be it social, cultural or community-based – for which members come together. Their purpose is not profit-driven, and any profit made as a result of their activities must be put back into the project.

Such associations are made up of members. And, as César Francis, a lawyer specialising in sporting issues, says, “members are owners of the club. Members have rights and obligations.”

As ideal as this may sound, the system is by no means perfect. According to Francis: “One of the scores to settle is guaranteeing the exercise of the rights of members. We must foster participation in the community spaces that are clubs, we have to make the handling of the money as transparent as possible, and we must seek the commitment to assume the role that being one of the owners of the space implies.”

Returning to the case, he states: “What has happened with Comunicaciones is very important, as clubs in Argentina make up our collective and individual DNA, our identity. The world registers you by your name and by what team you support. Losing a club is losing part of our identity as a society, it is irreparable; what is at stake is a feeling of belonging.”

The Case of Comunicaciones

Founded in 1931, Comunicaciones was born out of the Postal and Telegraph Union, which is where the club’s yellow and black colours come from – the international colours of post. In 1953, president Juan Domingo Perón donated the club a 17-hectare block in the Agronomía neighbourhood, in the heart of the city.

Like most clubs, Comunicaciones is mainly a football club and it participates in the AFA (Argentine Football Association) league games and tournaments. Having made its footballing debut in 1960, today it is in the third division, the Primera B Metropolitana. But the club is better known as a focal point in the local community by the generations of members and locals who have made use of its swimming pool, tennis courts, or any one of the multiple disciplines that it harbours, or attended the carnivals and fiestas. As a result, the club reached a membership of more than 60,000.

Ruiz explains: “It was impressive. I have lived my whole life opposite here, as a kid I always came to the club to practise sports, to the pool, to the parties. I even became a lifeguard as a result of what I learnt here.”

In the 90s, things started to change. The Argentine postal service didn’t escape the wave of privatisations initiated by the government of Carlos Menem. When, in 1997, the Socma group, led by Franco Macri (father of the current mayor of Buenos Aires, Mauricio Macri), bought the service, it stopped supporting the club. This, combined with bad management throughout the last decade, left the club in a precarious economic situation.

New Law

The onset of the 2001-2 economic crisis started to be felt in the year 2000. And the clubs, not just Comunicaciones, were not immune to the crisis. Many of them saw their debts increase and lacked the means to reverse this situation. The most significant case was that of Racing Club in Avellaneda.

In 1998, Racing, one of the five big Argentine football clubs, filed for bankruptcy with debts of more than US$60m. The following year, Liliana Ripoll, the official designated by the justice to oversee the break up of the club under the bankruptcy law, said a phrase that would go down in history: “Racing Club Asociación Civil no longer exists.”

Upon hearing the news, fans marched in protest in various parts of the capital. The following Sunday, Racing was due to play Talleres de Córdoba, but the game was suspended as a result of the club’s situation. People showed up at the stadium regardless, and at the time of kick off more than 30,000 people were in the stands. Finally, facing the prospect of the club being auctioned off, various sympathisers chained the installations to stop it from happening.

As a result of the media repercussions and the social mobilisation surrounding the Racing case, a new law started to be mooted, which considered an exemption for sporting institutions if faced with bankruptcy proceedings.

Supported by the recognition of the social function which clubs carry out, in mid-2000 the national congress passed law 25,284: the ‘Special Regime of Administration of Sporting Entities with Economic Difficulties. Management Trust with Judicial Control.’

The law stipulates the formation of a governing body for the institution facing bankruptcy, which would be judicially controlled, with the key administrators chosen by a judge. The governing body should aim to continue the club’s activities, restructure its finances, and guarantee the rights of creditors, whilst getting back the normal functioning of the entity.

As with many clubs, the ruling played in Comunicaciones’ favour. That same year, with a debt of $12m, it entered under the new regime, and was granted a period of up to nine years to improve the situation and give the club back to the members. If it did not manage to do this, the Bankruptcy Law would be applied and the institution would be liquidated.

A Special Case

So Comunicaciones was given time to regularise its situation, and during the nine-year period, three different governing bodies took the reigns.

However some club members had doubts over the willingness of the governing bodies to really get the club back on its feet, doubts that increased in 2006, when judge Fernando D’Alessadro took over the case, and were confirmed when he named Eduardo Fenochietto as the third head of the governing body.

Veiga talks about some of the irregularities of the process: “The governing body was supposed to be formed by three people and there were two of them, they were supposed to be chosen randomly and instead they were hand-picked, and the participation of the club members’ was supposed to be encouraged.” But that was not the worst, “both the judge and Fenochietto were involved in the bankruptcy of the Hogar Obrero cooperative, and Fenochietto was also involved in the bankruptcy of Zanón Ceramics,” he says.

He continues: “With Eduardo Fenochietto came a policy of expulsion of members, because he knew that a lot of people were opposed to his mandate. First they raised the membership cost sharply under the pretext of having more money coming in, something that didn’t happen, as many members left. At the same time they didn’t allow new members. In second place, they let the club fall into disrepair, they didn’t do anything to maintain it.”

And so the members began to act. “We all got together and we realised that each area of the club had the same problems, and so we decided to work together to get the club back on its feet.” Conversely, the attitude of those who were supposed to be watching over the club was very different. “Fenochietto told the footballers that he was not going to sort the situation out, and he told the school that the club was going to shut down. The only option was mobilisation,” Veiga explains. At the start of 2008, protest marches began.

For Sale

In October 2009, upon completing the period the club was legally entitled to in order to improve its situation, the members fears were confirmed: nothing had changed, the debt remained at $12m, and Comunicaciones would be handed to the highest bidder.

The city government promised to save the club and executed a plan that included an offer of $26m to pay the debts and improve the installations, and in return it would take six hectares of the club’s land to build a multi-purpose stadium. The offer was doubled by Hugo Moyano, head of the Truck Drivers’ Union, and members accused them of having made a deal.

Ruiz explains: “When we went to the government with 15,000 signatures from neighbours, they welcomed us in and asked that we work for PRO in the 2011 elections, said we shouldn’t worry, and that they would save the club. Two months later Francisco Cabrera, minister of economic development in the city, made a pact with Moyano to hand over of the club in exchange for resolving the issue of trash collection in the city.”

The judge ruled in favour of Moyano’s union – the highest bidders – and immediately a group of members and fans, as well as the city government, appealed the ruling. According to Vega, “the ruling did not consider some fundamental questions, such as the irregularities of the governing body which led us to this situation.”

Francis said: “Beyond the errors that led Comunicaciones to bankruptcy, and how slow the members had been in taking so long to react to the situation, nothing justifies that they prioritised a commercial transaction over saving Comunicaciones, when they were able to save it.”

All It Takes is Good Will

Since the ruling, the members started organising to maintain the day-to-day running of the club. And as such they realised the potential it had. According to Ruiz, “the activities which are going on today generate more than $2m a month of which the governing body only counted $190,000.” Which is why Veiga considers that “with good will from the governing body and with everyone pulling together, it will not be too complicated to pay the debt.”

Today, the members guarantee the full functioning of the club. From more traditional sports, such as basketball, roller hockey, or artistic roller skating, Comunicaciones has also surprised many with its development of major and minor baseball divisions and for being the home to the Argentine Association of American Football championship.

The Little Fish

In July this year, as the appeals process was reaching a crescendo, fans and members of the club were among those who decided to take over the installations, “to say no to the truck driver Moyano”, recounts Ruiz.

Then on 21st August, the members’ dreams were fully realised when the ruling went in their favour, giving them three more years to clear the debts and, with some luck, get the club back.

Veiga, who considered that the ruling which revoked the process of tender “is an act of justice”, summarises the feelings of the members: “We believe that all the clubs in the country have to be Asociaciones Civiles, which belong to the members. We were opposed to the entry of any private offer, this is not something against Moyano in particular, but we do think that the club is for the neighbours, the members, and not for a union.”

César Francis goes a little further in his analysis, stating that: “It is a battle that has been won by the community against the markets. It is a version of the big fish eating the little fish, the markets eating up these community spaces, progress against that which many would like to see as museum pieces.”

Government stockholders voted to close the publication La Nación permanently at a board meeting this morning. Assets will be liquidated and 117 workers will be left unemployed.

The Chilean government holds 70% of the company’s stock and therefore a decisive role in the publication’s future. According to a TeleSUR correspondent, government representatives were the only members who voted in favour of the closure. President Sebastián Piñera has advocated the liquidation since before assuming the presidency in 2010.

The decision is strongly opposed by private stockholders, journalist unions, social organisations, and several parliamentarians. Union representative Víctor Pérez told Radio Tierra, “The arrogance and tyranny of this government prevailed.” Representatives for La Nación employees slated for unemployment filed a case in the Appeals Court of Santiago to dispute the closure.

National Secretary General Andrés Chadwick defended the decision in front of the stockholders’ board, saying, “For 20 years we have seen a newspaper, La Nación, that has always had the tendency to be utilized under the government in power, and we believe that this is not convenient.”

Parliamentarian Hugo Gutiérrez has called upon the government to explain the decision in front of a special session of the Chamber of Deputies. “The citizenry wants to know what the motivation, the reason, is, and I believe that Chadwick must explain it.”

The publication stopped printing last December after a decrease in income, subsisting solely online since then. Nevertheless, according to Pérez, the company earned more than 2bn Chilean pesos last year, the equivalent of US$4mn.

La Nación has published continuously for 95 years.

“This was Bosque Alegre up until last year, lush vegetation, lots of trees,” says Sylvina Madero, pointing to the photographs of dense green forest land which hang behind her.

“Then on 12th April this year, phones started ringing. They came in with 12 bulldozers, 100 municipal workers arrived with chainsaws, and this woodland with lush vegetation became this and this.”

She gestures to images showing a bleak, muddy expanse of land, bordered by torn protest posters and abandoned tools.

“By the time we found out what was happening, half of our woodland had already been cleared.”

The Bosque Alegre (‘happy woodland’) is a native woodland situated in the wealthy suburb of San Isidro, in the northern Greater Buenos Aires. It is one of several woodlands lining the coast of Buenos Aires increasingly at threat from development and deforestation. Since control of the land was ceded to a private sports club in 2011, the forest has become the centre-point of a fierce battle between the municipal government and local community rights groups. What was once a peaceful recreational space has become the site of a controversial debate over land ownership, ecological protections, and political priorities.

Bosque Alegre: The Story So Far 

The four-hectare Bosque Alegre is located in the riverside suburb of San Isidro. Its chocolate box cafes and elegant houses mask a network of boundary lines, which divide the region between the large companies and private businesses.

“All this is private. Unless you pay, you can’t enter” says Romina Rocca, member of the Bosque Alegre Assembly, the group established to protect the public woodland.

“The law says that access to the river should be public, but in reality that isn’t what happens at all. Everything is privatised and access to the river has been cut off and closed in. There are only two or three areas along the river that the public can access now” she says.

Bosque Alegre is one of these areas. With its reed beds and towering trees, it occupies one of the Campos; a grid of fields divided into tennis courts, football fields, and a conference centre. The Bosque is one of the last coastal forests found in Buenos Aires and is home to many increasingly rare indigenous species as well as being a recreational ground for the local community.

However on 10th May, 2011, the municipal government, led by Gustavo Posse, signed an agreement with Club Atlético San Isidro (CASI) to cede the club the area covered by Bosque Alegre. According to Posse, the agreement was intended to secure investment for San Isidro while sustaining the woodland’s identity as a public recreation area. “An agreement was reached whereby CASI would make investments in the area by installing lights, changing rooms, and new turf,” says Posse.

“The club would only be using the area for a small percentage of time and it would be used by the public the rest of the time.”

Posse claims the land was always intended to remain public, but many disagree with this assessment.

“The government didn’t technically sell the land, they gifted it. Officially, the government has ceded the land to CASI, but that’s not public land, that’s a lie,” says Rocca.

Buenos Aires province’s general environmental law (11,723), states that any changes to public property must be preceded by an environmental impact assessment and a community consultation. Neither of these were undertaken prior to the CASI agreement, prompting widespread community anger. This anger reached new heights in September 2011, when un-identified workers arrived to fell trees before the conclusion of the deal – prompting accusations of illegality and corruption between the sports club and municipal government.

“The community have to be consulted, have to be able to participate and give their views on the works. No-one consulted anyone on anything about this. All that happened was that one day, they came in and cut down all the trees,” says Johanna Rudich, member of the assembly.

Mayor Posse acknowledged this at the time, and now says “there have been communication issues from CASI, however there have also been misunderstandings.”

Bosque or Not?

One of the biggest misunderstandings revolves around the definition of the forest and its assessment in terms of ecological importance.

According to  Arturo Flier, Secretary of Community Integration for San Isidro, “Bosque Alegre does not qualify for legal protection because it is not a native forest. It was used as landfill until the 1990s and contains mostly non native species.”

While this is true, biologist Analia Dalia claims the woodland still qualifies for protection under the Ley de Bosques due to its value as a site of biodiversity and urban ecology. “Bosque Alegre is one of the last remaining typical coastal forests on the Río de la Plata and is home to more than 200 species of wildlife,” she says.

“Before the felling, Bosque Alegre had a large number of native species, including Creole willows and alder trees. We know that the tree felling destroyed a plant called Equisetum giganteum rarely observed elsewhere in Buenos Aires.”

The trees and plants also help to protect San Isidro from flooding, as well as retaining nutrients and the purification of water.

Protecting the Woodland

These struggles to define Bosque Alegre and its ecological value are crucial for its legal and political protection.

The assembly have so far succeeded in obtaining an injunction to stop all current works on the Bosque, and now are seeking a mandatory halt and re-definition of the area as a ‘natural park’. At the moment, it is only protected through a lesser ‘protected landscape’ designation.

This designation was obtained on 11^th April 2012 and does little to prevent development on the woodland as it permits private administration as well as alteration and manipulation of the land. The futility of this label was proven just a day after its introduction, when un-identified workers arrived to undertake the second tree felling. In an event the assembly refer to as ‘the repression’, municipal workers cleared half of the four hectares, prompting the mass protests which made headlines across the city.

“I stood in front of the chainsaws, many people did,” says Madero. “It was a terrible day.”

“After the repression, we got advice,” she says. “At this point, we have a team of lawyers working to find out how they can stop this happening. But everybody says that the best way to put pressure on them is through public humiliation”

Madero knows that legal protections are hard to achieve, even when laws do exist. She watched the passage of the ‘Minimum measures for the environmental protection of native forests’ law (commonly known as the ‘forests’ law’), introduced in 2007, which despite enshrining numerous protections for Argentina’s forests does not help the Bosque Alegre. It was never included in the original list.

“Bosque Alegre is a woodland, it is,” says Rocca, “but it’s not in the land registry, it doesn’t officially exist.”

Public Land, Private Interests 

“Argentina has excellent laws, but there is a phrase in English – “where there’s a will there’s a way” – and this is very accurate here; sadly when there is a private powerful interest, they find a way to get around it,” says Emiliano Ezcurra.

Ezcurra is the head of ‘Banco de Bosques’, an NGO established to protect native woodland across Argentina. He has a big task on his hands. By the time the forests’ law was passed in 2007, 70% of the native forests across the country had been lost, divided between agricultural giants using the land for monoculture cropping.

According to figures from the Secretariat of Environment and Sustainable Development, between 1998 and 2006, deforested land in Argentina accounted for 2,295,567 hectares, the equivalent of 250,000 hectares a year and one hectare every two minutes.

“The Bosque Alegre is a very different case to the larger forests in the country, but it is still an issue of privatisation,” Ezcurra says, referring to the fact that Bosque Alegre is a much smaller, urban woodland.

“This is about the relationship between the government and a private company. It’s about how governments can twist and change laws to enable private companies to use land which belongs to the community.”

In this green, spacious suburb, recreational land is hard to come by. For those who can’t afford private club memberships, there are few places to enjoy the natural coastline. It is this that so many want to protect.

“I grew up here, I want my children to play outside and enjoy nature. We need that” says local resident Alison Salas.

So far more than 5,000 signatures have been gathered by the assembly and protests are regularly held on the land, but the future of Bosque Alegre remains uncertain.

“We’re fighting for the forest, but we’re fighting for more than that,” says Rocca. “The idea is to put these topics on the agenda, to ask what is happening to public space in San Isidro”

The fight looks set to continue for a long time yet. However for many, including Ezcurra, the decision is clear.

“The community want it to be saved and it’s public land, so it should be saved. It’s as simple as that.”

To find out what locals think of the issue, click here.

Planning Minister Julio De Vido has denied claims issued by Clarin that a meeting was held between himself and the governor of the Chubut province to acquire shares of Reposol-YPF.

The national newspaper published a story in today’s paper, noting that the minister met with governor Martín Buzzi to discuss the possibility of using social security funds to buy as many shares as necessary to renationalise the company.

Clarín later reported the governor’s response, which included the claim that the report should be considered as “misinformation.”

According to Clarín, Buzzi stated that the project to purchase YPF would make use of social security funds from the National Administration of Social Security (ANSeS) and private equity. The project allegedly has the backing of ANSeS director Diego Bossio.

The Clarín article claims that the governor of Chubut consulted the Ministry of Planning at every stage. However, the ministry has denied that the minister was aware of the issue.

“De Vido has not received any such offer and has not met for that reason with the governor Martin Buzzi or ANSeS executive director, Diego Bossio, neither jointly nor separately,” said the Ministry of Planning.

Talk of nationalising the Spanish-owned oil company is not new. On 21st March, the head of Repsol YPF met with national government representatives to discuss the country’s role as a shareholder. At that time, the head of the Cabinet, Abal Medina, told journalists that “if YPF’s path is nationalisation, then nationalised it will be.”

Rumours were rife in February, affecting the price of shares in the company.

The Water and Sanitation Committees of Nicaragua (CAPS) protested against the privatization of drinking water.

President for the National Assembly of Nicaragua René Núñez, denied the government had intentions to privatize drinking water. Meanwhile, the Nicaraguan vice-president Jaime Morales Carazo and the second vice-president of the parliament, Carlos García Bonilla, rejected the allegations.

Morales pointed out that the NicaraguanWater and Sewage Company (Encal) must abide by the General Law of National Waters. In its fourth article it states that the water is a Nicaraguan patrimony and the national state should promote its conservation and sustainable use.

Social organizations such as the Defense of the Consumer Network have announced protests against the measure to ensure that the intentions of it being implemented are discouraged.

Story courtesy of Agencia Púlsar, the news agency of AMARC-ALC

A country with such a large territory like Argentina has always needed a reliable transport mode to connect its regions and different provinces. Today, motor transport has almost entirely taken over from the railways and most Argentines prefer the bus to the train for long distance journeys across the country. In 2008, bus services in Argentina welcomed around 65 billion passengers when only two billion used the train. The decline of what was the world’s tenth largest railway network after the Second World War has left many scars in the country’s demography. Indeed, it has dried out many economies which were geographically far from Buenos Aires – what were once prosperous towns have now become ghost villages.

The railway has been an important factor in Argentina’s development. The train allowed the most remote regions of the country to be reached, and allowing passengers and merchandise to get to Buenos Aires’ port, the main connection with the rest of the world. Pino Solanas, the Argentine director behind ‘La Próxima Estación‘, a documentary on Argentina’s declining railway network, strongly supports the return of the Argentine train. He claims that the railway costs “seven to eight times less than motor transport” as a locomotive can carry as much as 50 lorries’ load and an average sized train can carry as many passengers as 19 buses. Moreover, one of the best advantages of the train is that it can be run in any weather conditions. So why did such a great form of transport suffer such a significant collapse in Argentina?

Bad Management

In the late 19th century, the success of the first train lines, which ran between Buenos Aires and the west, attracted vital foreign capital, mainly from the UK and France. These investments allowed a major expansion of the railway between 1870 and 1914, and Argentina was soon on the way to the 47,000km of track it had by the end of the Second World War.

Photo by Brian Funk

An Old Dining Car left for restoration in the Argentine Ferroclub in the Remedios de Escalada neighborhood in the province of Buenos Aires.

This situation remained so until 1940, when Juan Domingo Perón decided to nationalise the network to renew the one hundred years old tracks. Perón asked US general Thomas Larkin to undertake a study on transport in Argentina, with the results known as ‘Plan Larkin’. The nationalisation proved popular among some influential people at the time. Argentine writer, Raul Scalabrini Ortiz strongly defended the move saying, “The most powerful instrument of the English hegemony on us is the railway. The railway weapon is the fare. It can wipe out industries, create privilege zones, organise regions, stimulate particular cultures but also destroy growing cities.”

The plan essentially consisted of eliminating 32% of existing tracks, sacking 70,000 workers and renewing the locomotives and carriages by buying new material from abroad. By the 1970s the network was only 30,000km long.

At the end of the 1980s the situation of Ferrocariles Argentinos was at its worse. Only half of the locomotives were in use while the rest of them were left abandoned. The wave of privatisation instigated by President Carlos Menem at the start of the 1990s did not spare the train, and the quest for profit influenced the closure of a number of unprofitable lines in remote provinces. This was a fatal move for many of the towns wherethe railway was the actual raison d’être and had boosted the economy in such parts of the country.

In 1993, Ferrocariles Argentinos cancelled all the long distance passenger services, which were handed over to the provinces. Only the nationwide freight service remained privately owned: the network in Buenos Aires region was split between four private companies.

Photo by Brian Funk

Train tracks in Belgrano exiting toward the provinces of Greater Buenos Aires.

Today, the network consists of 7,000km of track, and only 17,000 workers remain.

“In our country, ‘Plan Larkin’ cancelled train lines to save money, but its real target was to weaken regional economies and the national industry. What have we saved? Nothing!” says Pino Solanas.

“By choosing motor transport, the state is paying one of the most expensive transport systems in the world. It equals to 27% of the country’s GDP when other big countries like Canada and Australia only spend 9% of theirs on this mode.”

Lorry Workers Union Domination

Jorge Felipe Ruffa is a 61-year-old train enthusiast working for Ferroclub, an association to preserve the memory of the Argentine train. He believes the decline of the train to be due to Argentina’s geography, saying “The reason to this is the political proximity with the US.”

The large number of motor companies in the US pushed Argentina to use the road more than the rail as a transport mode. Moreover, the motor industry is really powerful in Argentina. As an example, the leading union in the country is the lorry driver’s union. For a transport company it is also cheaper to work on the road – the company only has to buy the lorry; the road is maintained by the state. A rail company, on the other hand, has to take care of both the trains and the tracks.

Photo by Brian Funk

Old freight train now resides in a walk through museum in the Argentine Ferrclub in Remedios de Escalda, Buenos Aires.

“When I was younger, we used to travel from Buenos Aires to Mendoza in 16 hours on the train. Today, for the same distance, a train would take 25 hours because the tracks are not maintained correctly. It is obvious that the bus is winning the competition, even though it is more dangerous,” says Jorge.

“North America has many more motor companies than railway ones. It was then much easier to trade with them if Argentina was using the road as a transport mode,” he continues.

A study of responde.org a specialist group who went through national statistics in 2007 found that 40% of villages in the countryside are threatened with extinction. The study counted about 800 villages with less than 2,000 inhabitants. An article in newspaper Clarín  claims that the suspension of the train had pushed people to migrate to big cities to work or study, and preventing them from coming back to their home town.

“The village extinction favoured the exodus to big cities which are not prepared to receive these people, and they end up living a really precarious life,” says Marcela Benitez, founder of Responde.

The Case of Mechita

Mechita is a small town situated at about 200km away from Buenos Aires. The town was first built in 1906 when Manuel Quintana, a Buenos Aires entrepreneur, gave two parcels of his land to build a railway warehouse. Historically, close to 95% of the active population directly lived from the railway industry. Until the 1990s the majority of the town’s income was coming from the railway industry which was the only work available.

Photo by Brian Funk

Old cargo trains in the Argentine Ferrclub in Remedios de Escalada, Buenos Aires.

Often referred to as the “railway colony”, the village had around 5,000 inhabitants in 1950. However, the railway crisis strongly hit the life of the village.

“During the railway era, you could find people on the street at anytime in Mechita. The warehouses were operated 24 hours a day,” remembers Ismael Sánchez a former train carpenter. “When we had to leave, because of the privatisation, we tried to keep an activity through recycling carriages and many of us had to leave for the a big city.”

The population went down to 2,400 inhabitants in 1980 and just,850 in the last census in 2001. Sixty percent of the population is over 65, many of them are unemployed while those with jobs dedicate their activity to the services sector. Nowadays, only one train a day stops in Mechita passenger station, 60 years ago there were about 20.

Many of those villages are trying to find a new way to get their place back into the country’s social economic space. Responde set up a plan to use the past of the village as a tourism advantage, build a museum and organise visits of the warehouses.

Since Menem’s privatisations, 800 train stations have been shut. Therefore, the case of Mechita is not an isolated one. In the last two presidential mandates, a few projects have been proposed regarding the train, though most are poorly targeted. For example, instead of refurbishing existing tracks, the government pays large subsides to private companies.

Photo by Brian Funk

A once important cargo car transported around the country is now just an historic antique in the Argentine Ferroclub in Remedios de Escalada, Buenos Aires.

Néstor Kirchner’s government also bought a large number of second-hand locomotives and carriages from Europe when only 86 out of 298 local vehicles are used. The cost was estimated at $1,5bn. A couple of years later, his wife and current president Cristina Fernández de Kirchner, proposed the installation of a high speed train, the ‘Tren Bala‘, to unite Buenos Aires, Rosario and Córdoba, Argentina’s the three biggest cities.

Pino Solanas claims that with half of the budget planned for the Tren Bala project, the government could buy 11,000 km of tracks for cargo trains, 7,000 km for the five biggest services to the provinces, more than 300 locomotives and hundreds of new carriages to bring back the average speed to 120km/h.

Government Policies Today

On 15th January, Pablo Schiavi, Argentina minister of transport, inaugurated a double decker train at Retiro station. “The railway service grew up in a bestial way,” he commented. “Trains are becoming more reliable and therefore people use them more.” Unfortunately, those trains are only set to run in Buenos Aires Province and yet, nothing is done to renew passenger inter city trains.

Regarding the cargo network, things seems to be moving since the minister of transport recently travelled to the Santiago del Estero province, in the north of the country. Schiavi joined local governor Gerardo Zamora to sign an agreement to renew the Belgrano Cargas services (currently working at only 30% of their capacity) in the province. The $650m investment is meant to reactivate a transport pole in the province that would benefit to the whole north of the country. “This will clear the roads and also reduce transport costs,” says local producer Pablo Karnatz. “The railway is really important for our region. Lorries should only be a link to the railway and not replace it.”

Works on the Belgrano Cargas were meant to be part of the 2004 Plan Nacional de Inversiones Ferroviarias. The $300bn investment plan implemented by Nestor Kirchner aimed at renewing the whole railway network by 2007. When today, long distance trains cannot run faster than a 40m/h speed, many worry about the speed of the works on Belgrano Cargas lines.

President Cristina Fernández de Kirchner’s bill to nationalise pension plans received final approval from the Argentine senate on 20th November when it was passed as official law.

Kirchner’s government will now manage US$30bn in private pension funds, a presidential proposal slimly approved by congress’ lower house on 7th November after 14 hours of rigorous debate.

The ten AFJPs (Retirement and Pension Funds Administrators) in Argentina created in 1994 constituted the country’s largest institutional investors. The controversial new bill has shaken the stock market and caused an 11% slump in shares, sending the value of the peso plummeting.

Conservative Peronist president Carlos Menem created the private pensions system. The current president argues that this decision was followed by a 10% recession. Last year, then-president  and husband of current president, Néstor Kirchner, altered the law so that workers could move freely between the private system and the public system (beforehand a worker could only choose at the start of their working life).

Use of the funds

President Cristina Fernández de  Kirchner officially plans to use the money to sustain Argentina throughout the current global economic crisis. She also insists that the new unified system will protect future pensioners with funds previously in AFJPs from the volatility of the “intangible markets” that the ten organisations had invested money in.

But many critics question what exactly Kirchner plans to spend the money on. The government’s stance seems ambiguous to many. Kirchner’s claim that the new funds will only be used for social security and investments in Argentine infrastructure has been subject to much doubt. 

In an interview on Argentine terrestrial television news channel C5N, the president defended her decision to ‘protect’ her people, denouncing measures taken by more economically developed countries. “We are making this decision in an international context in which the leading countries in and out of the G8 are protecting their banks, while we are protecting our retirees and workers”.

ANSES vs AFJPs

The National Social Security Administration (ANSES) has now taken over the funds. The head of the governmental organisation, Amado Boudu, triumphs that the “failed experiment” of private pension funds “charging high commissions for low returns with a lack of a guaranteed minimum income” started 14 years ago was over. For these reasons, many with a centre-left stance, including union leaders, support the new law.

But Boudu himself has something of a shady past, leading to further public distrust in the government. He was accused of embezzling $20m from an accommodation plan that never came into fruition: the commissioned houses were never built. Before that, under his direction the company Venturino SA (an agricultural machinery dealer, also a John Deere concessionary) went bankrupt.

Administrators of the ten AFJPs call their system a “solid mechanism with an almost constant growth trend in the 14 years of its existence”. There were three million contributors but only 450,000 pensions being paid out, so pensioners were receiving high returns.

On the other hand, since the creation of the AFJPs, $96bn has been saved towards pensions yet an astronomical $36bn have been spent in ‘administration fees’, causing many to ask whose corruption is worse, that of the private sector or that of the government.

International repercussions

Debt repayments have gone unmentioned; causing international scepticism amongst Argentina’s many previously deceived debtors. 

Global financial markets are concerned of a repeat of Argentina’s 2001 debt payment default where Argentina evaded US$95bn in debt, the biggest such default in history. Argentina’s current debt payments are due in the second half of 2009, the distant future in political terms, and there are suspicions that the funds will be used next year to win mid-term elections.

Kirchner’s government has required the AFJPs to repatriate all money invested abroad. Around US$200m of pension fund assets is currently held in the US.

US district judge Thomas Griesa has extended the freeze of Argentina’s transfer of its pension fund investments out of the US as lawyers for bondholders hold a US$553m judgment against Argentina, requiring to know where assets are held in the US and by whom.

Griesa worries of a “threat of irregular behaviour by Argentina” and is “concerned that Argentina will move the assets into its general treasury”. He added: “I don’t want to wake up next Friday, after some legislation, and find 200 million dollars has been shipped out of New York.”

Oliver Armas, a Cuban-North American lawyer for eight of the ten AFJPs, and Jonathan Blackman, a lawyer for Argentina, opposed the extension of the freeze order. Armas insisted that “the assets belong to future Argentine retirees, not the government. Therefore it is the people losing out, not the state.”

Lack of governmental confidence

The press secretary of the PAMI, (Integral Medical Attention Programme), the non-governmental organisation protecting the social security interests of Argentine pensioners, says that these criticisms spring from distrust in the “greedy and corrupt governments” Argentina has suffered under in the past.

President Kirchner has held office for less than a year and has thus far proved extremely unpopular due to growing inflation and some controversial propositions which have gone on to be rejected by members of her party as well as the public itself.

The Campo Crisis earlier this year saw public confidence in Kirchner take a nose-dive; especially when her own vice president Julio Cobos voted against her bill to increase tax on agricultural produce exports.

Kirchner’s plan for a ‘tren bala’ (bullet train) to connect Argentina’s three largest cities (Buenos Aires, Rosario and Córdoba) was also received by numerous protests nationwide, particularly from disgruntled commuters who could not even count on a reliable suburban service from regular trains.

Problems even surface amongst those for nationalisation. María América González, opposition lawmaker and supporter of the new bill, has “serious doubts about how the funds will be managed. The government’s stance just seems a little ambiguous to me”.

Conservative daily La Nación called Kirchner’s move “legalised robbery”. Socialists and radicals who have been opposing private pensions all along have been left in an odd position. The rebel Peronists are a ‘workers party’ and the decision is a win-win situation for the working class. Therefore, many critics consider the move an attempt to win political support from the various branches.