No subway, José

Can the problems of Argentina be compressed and be well represented by one single conflict? Yes, they can. The Buenos Aires subway strike was still going on at the time this column was being written. Commuters’ nerves are frayed. Getting somewhere in this city during the rush hour has been difficult for an entire week.

It’s all because of the subway strike. There’ve been such walkouts before. But never for so long have nerves been on edge like this. In Argentina, collective wage bargaining — the annual round of salary talks between unions and management often sponsored by the Labour Ministry — can be traumatic. Strikes are common. But because most unions are controlled by powerful leaders with contacts in high places, and are often supportive of President Cristina Fernández de Kirchner, walkouts don’t usually get out of hand.

There is more trade union unrest in general now because Fernández de Kirchner, a leader of the Peronist party, ahead of last year’s presidential election refused to accept the political demands of one of her key strategic allies: teamster Hugo Moyano, the leader of the General Labour Confederation (CGT).

The CGT is heading for a major rift. A faction of big pro-government unions no longer accepts Moyano, who was re-elected last month by his faction, as leader of the CGT.

The pro-government unions plan to elect a new leader before the end of the year. Moyano’s teamsters recently launched an aggressive strike in the middle of salary talks, that included picket lines at a fuel distribution plant in Greater Buenos Aires. But even Moyano’s round of collective wage bargaining was eventually settled.

The teamsters signed a salary agreement and are now voicing demands for income tax breaks for workers and a minimum wage of 3,500 pesos a month. Moyano, according to CFK administration officials, is now part of the opposition. Moyano’s CGT is reportedly “planning a general strike” with other trade union groups, including the anti-government faction of the CTA Argentine Workers Congress that is dominated by the ATE state workers union. Yet even Moyano has called a time out.

So what is going on with the subways? At odds in the conflict are two unions. One union involved in the conflict is the official UTA transport workers’ union, which has historically held the legal status to represent the bus-drivers and the subway workers. The other is a breakaway workers union headed by militant leaders who seem to effectively represent the subway workers judging by the extent of the strike.

Yet the spat between UTA and the breakaway militants is not even half of the story. Also at odds are the President and Buenos Aires City Mayor Mauricio Macri, the leader of the centre-right party PRO. The national and municipal governments in January signed a preliminary agreement to transfer the subways from nation to city. The accord included a transition period of 90 days. But Macri made the snap decision of jacking up fares by 127 percent (from 1.10 pesos to 2,50 pesos). But come February a Sarmiento line train crashed at Once station, killing 51 people and putting public opinion in a foul mood.

Macri balked at taking over the subways as national government officials scrambled to deal with the Sarmiento line crisis.

This subway strike was called when no progress was made in wage talks that formally opened at the start of this month.

The striking workers soon realized that the national Labour Ministry and the municipal government were trying to avoid taking part in the talks.

UTA, which has historic ties to the Peronist party and is technically a pro-government union, quickly cancelled its part in the strike. But the militant breakaway union, established by disgruntled subway workers who felt betrayed by UTA, did not.

Both the President and mayor are trying hard not to blink in this conflict since the strike kicked off on the night of August 3.

The problem for Macri is that the crisis is unfolding in his territory. Fernández de Kirchner meanwhile has less to lose politically because the Peronist party, now part of the ruling Victory Front coalition, has rarely performed well in Buenos Aires City.

Macri’s ability to deal with problems is being tested and the outcome of his performance could be settled in next year’s midterm elections. PRO, of course, needs to score a convincing win next year for Macri to then ready what is expected to be his presidential bid in 2015. The conflict has erupted at a time when the President’s popularity is dropping (currently it stands at about 40 percent, according to polls). But polls show that Fernández de Kirchner is dragging Macri down with her due to the subway conflict (also part of the bickering is a Kirchnerite bill approved by the Lower House on Wednesday to rid Banco Ciudad of court system deposits). This situation could suit Fernández de Kirchner just fine because voters beyond Greater Buenos Aires are not hurt by the strike.

Polls also show that what public opinion wants is politicians to work together. This would explain why Buenos Aires Governor Daniel Scioli, a Peronist, has refused to turn on the President despite growing tensions over the Victory Front’s presidential nomination in 2015.

On Thursday night, when it was clear the militant subway union was not giving in and the national Labour Ministry was still looking the other way, the municipal government issued a call for compulsory conciliation — a move that if heeded would bring the situation back to square one. Yet Friday’s talks still made no progress and the call for conciliation was reduced to a technicality. The technicalities continued because UTA signed a salary agreement accepting a 23 percent wage hike tied to the economic performance of the subway company Metrovías, which has criticized the mayor’s handling of the situation.

Macri has accused the militant union leaders of being “Kirchnerite” and has said that the strike is “political.” (Néstor Segovia, one of the subway union leaders, is a member of a pro-government party headed by the Kirchnerite activist Luis D’Elía).

The subway strike, the mayor said, is part of a bigger political deal. The President, according to Macri’s statements at a press conference on Friday, aims to humiliate rivals who think differently.

It’s difficult to pinpoint exactly what the President thinks about this particular strike because she has now chosen not to address the issue in public. (Yesterday, to the outrage of PRO officials, CFK’s office isssued a television advertisement during the state-run live coverage of soccer blaming Macri for the situation).

The strike has been long. But please don’t panic. Get yourself a bicycle or walk to work. Save your exasperation for when the time comes to vote.

It’s possible that the subway strike will be an issue in next year’s elections in the city. Then you’ll see who voters have blamed for the mayhem. The President’s Victory Front, of course, is used to losing here. So the question is if the subway strike will linger like a bad dream in the memory of voters long enough to harm the performance of Macri’s PRO next year.

What’s certain is that the elections are a long way off and that things will not change fast.

The President is sitll in charge. Fernández de Kirchner is not talking about the subways. But she is speaking her mind about many other issues and making sure her word is spread. The President’s speech on Thursday, at a new YPF energy company diesel plant in Ensenada, was carried live as a national broadcast. It is the 13th such broadcast (forcing all national private channels to carry the speech) ordered by the head of state this year.

Fernández de Kirchner has been criticized by the opposition for using the broadcasts. But she claims they are required because the opposition press does not cover her events. Fernández de Kirchner on Thursday accused the newspaper Clarín of running false stories about the resignation of Miguel Galuccio, YPF’s recently-appointed head. The President denied the stories and called on journalists to consider drafting an “ethics law” to declare where they collect money from (see also Page 2).

The national broadcasts, the argument with Macri and the cold war with Scioli could be part of a wider strategy by the President to gain political supremacy.

The President’s zest for regulation, a recipe favoured by Deputy Economy Minister Axel Kicillof, has not stopped. Galuccio, named after YPF was nationalized in April, was purportedly thinking about resigning over the decree regulating the energy sector issued recently.

Kicillof’s recipes — with or without Galuccio — are not going away. On Friday, Argentina increased the duty on biodiesel duties. But Kicillof (an economist described by one Wall Street Journal columnist as “neo-Marxist”) denied any plans to increase the soybean export duty.

There have also been signs that the cold war with Scioli will escalate. Silvina Gvirtz, a Kirchnerite, quit Scioli’s education portfolio on Thursday, complaining about “streamlining.”