[SANITIZED]LATIN AMERICAN TRENDS: STAFF NOTES OCTOBER 13, 1976 - 1976/10/13

• Document Type: SPECIALCOLLECTION
• Collection: Argentina Declassification Project - The "Dirty War" (1976-83)
• Document Number (FOIA) /ESDN (CREST): 06628133
• Release Decision: RIPPUB
• Original Classification: U
• Document Page Count: 9
• Document Creation Date: April 3, 2019
• Document Release Date: April 12, 2019
• Publication Date: October 13, 1976

Approved for Release: 2018/10/02 C06628133
Latin American Trends
STAFF NOTES
Se
3.5(c)
sfiort
159
CI SNLA 76-055
No. 0995-76
October 13, 1976
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LATIN AMERICAN TRENDS
This publication is prepared for regional specialists in the Washington com-
munity by the Western Hemisphere Division, Office of Current Intelligence,
with occasional contributions from other offices within the Directorate of
Intelligence. Comments and queries are welcome. They should be directed to
the authors of the individual articles.
CONTENTS
October 13, 1976
Argentina: Changes at the Top, 6
ANNEX
Argentina: Junta Relations with Labor. . . . 17
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Argentina: Changes at the Top
The government's announcement that it has created
the new cabinet post ofjaanningkinister may be a
prelude to further changes at the top. General Diaz
Bessone, a regional army corps Commander, is vir-
tually certain to get the new joE.
The planning minister will coordinate the activ-
ities of all the other ministries. One purpose is
to centralize President Videla's authority over the
government, in response to military criticism that
he has not been assertive enough as President and
that government policy has lacked direction. More-
over, Videla and others may judge that the time has
come to devote increased attention to important issues
that so far have not received the priority treatment
accorded economic recovery and counterinsurgency.
Resolution of the difficult problem of labor's status
could be one.
Videla may also wish to delegate some of his
day-to-day reponsibility-as army commander in chief.
For this reason he is said to advocate creating his
new post of deputy army commander', to be filled by
a trusted aide. Other changes in regional corps
commanders may be forthcoming in the near future as
well, particularly with the next promotion cycle
approaching.
Bringing Diaz Bessone into the cabinet appears
to have several purposes. One is to separate the
general, often described as a "hardliner," from direct
command of troops. At the same time, Videla and his
key aides can more easily keep an eye on him in the
new position. Moreover, Diaz Bessone does indeed
have a reputation as a professiona2 planner and his
nomination is not illogical.
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The inclusion of the forceful general in the
cabinet could create difficulties. He is apt to
interpret rather broadly the guidelines for the new
ministry and will be buoyed by the fact that under
new succession provisions he will also head the entire
executive branch in the event of the President's
absence or illness. The President is scheduled to
make trips abroad in the near future. Another prob-
lem could come from Economy Minister Martinez de Hoz,
who long ago expressed opposition to the creation of
any new entity that might infrikge on his authority'
as top economic policy planner.'
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Sy, e 1
ANNEX
Argentina: Junta Relations with Labor
After six months of tight wage limits and strin-
gent political controls Argentina's heavily politi-
cized labor sector is becoming increasingly restive.
Light and power workers struck in the nation's capital
last week; earlier, thousands of disgruntled auto
workers laid down their tools in a number of major
plants. The highly organized workers probably con-
stitute a more formidable potential opponent than
even the leftist terrorists, and the recent strikes
are the most serious challenge so far to the junta,
which had earlier banned all such activity.
3.5(c)
Worker dissatisfaction poses a vexing problem
for the generals. The junta is loathe to alienate
labor irretrievably by using force against the workers,
yet at the same time it cannot afford to allow its
decrees to be disobeyed with impunity. Thus far the
government has limited its response to arresting or
ordering the dismissals of the ringleaders.
Labor restiveness will complicate and add urgency
to a divisive debate that has been going on for some
time within the armed forces. The more vindictive
officers argue for dismantling the labor movement,
the biggest and best organized in Latin America. The
more conciliatory advocate some degree of accommoda-
tion relatively soon. No resolution appears imminent.
Thus far the government has sidelined the problem,
rather than tackle it head on as it has economic dete-
rioration and left-wing terrorism. The junta banned
all strikes and placed federal admi^istrators in key
unions as well as in the Peronist labor confederation,
which embraces some three million of the nation's
work force. The most corrupt unionists were jailed
or exiled. The military probably hoped, rather than
believed, that this strategy would keep workers quiet
indefinitely, while it enforced the belt-tightening
it deems essential to economi recovery. Indeed,
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many officers probably were surprised that workers
waited as long as they did before protesting the
austerity measures.
The search for a permanent labor policy is great-
ly complicated by the emotionalism that surrounds
military-labor relations. Indeed, a certain amount
of hostility is virtually built into that relation-
ship. Some workers and officers view each other as
natural enemies. The military first spawned, and
ultimately rejected, Juan Peron, the man who gave
labor its political awareness and made it a force to
be reckoned with. Workers to this day retain a strong
loyalty to the man who dominated Argentine politics
for decades, and see the armed forces as unalterably
opposed to Peron's populism. Many officers, on the
other hand, blame the Peronists and unionism for
virtually all the ills Argentina has suffered for
more than a generation.
The junta's policies to date have, if anything,
served to increase the distrust that workers feel
toward the military. Not only did labor lose its
privileged position in the March coup, but it also
has been the element hardest hit by economic policies
since that time. Workers have been unable to catch
up with the continuing high cost of living because
wages are being strictly controlled,while prices are
not. Unemployment increased, though less than orig-
inally anticipated, in the face of declining demand.
Incentives for business and agriculture have also
added to worker skepticism. Efforts by the left to
exploit worker frustration have been largely unsuc-
cessful thus far, but the appeal of the left, in-
cluding that of the Argentine Communist Party, could
be enhanced if labor came to view the junta as hope-
lessly intransigent.
Delay in implementing a definitive policy may
be weakening the government's position by contributing
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to its image of indecisiveness and inviting further
challenge. Continued delay could embolden the Presi-
dent's conservative military critics who are pushing
a harsh line toward labor. At the same time, labor
itself may take the junta's hesitation as an invita-
tion to press its demands more strenuously.
A whole new crop of labor leaders has supplanted
those displaced by the coup. The newcomers are busy
trying to establish themselves in the eyes of both
the workers and the military. They are fully aware
that they could play an influential role if the junta
decides to reincorporate labor into national decision-
making.
These leaders face a dilemma. On the other
hand, they must have support of the rank and file;
this can probably be accomplished only by producing
some tangible gains for the unions. Even then, how-
ever, there is no guarantee that workers will follow
any leader who may emerge. Workers had become highly
suspicious of old leadership, which they came to view
as corrupt and unable or unwilling to deliver on
promises to its constituents.
On the other hand, labor's current leaders can-
not berxme identified with too much worker activism
lest the junta conclude they cannot keep the lid on
disruptive activity. Success or failure at walking
this fine line could tip the balance of military
opinion for or against those who, like Videla, favor
an accommodation with labor.
The government's efforts to date have been piece-
meal and its pronouncements less than definitive.
The junta earlier in the year modified the laws
governing the negotiation of labor-management con-
tracts, overturning several procedural clauses in-
spired by the Peronists and very favorable to labor.
The government also stiffened the penalties for
striking, in a hasty effort to quell the recent labor
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unrest. Declarations of intent to "normalize" re-
lations with labor have become more frequent in re-
cent months but are couched in vague terms. Thus
far, however, the junta has not altered the basic
laws governing labor; it has merely set them aside
temporarily. Until the government decides either
to reaffirm these laws or to scrap them for new ones,
labor will remain in a state of political limbo that
is frustrating for workers and therefore potentially
dangerous for the junta:'
Top unionists currently express optimism that
reform of the basic laws governing labor is in pro-
gress and that the final product will not drastically
alter the union structure. The union bosses are
betting that the military, in the final analysis, will
conclude that efforts to break up the unions would
irretrievably alienate workers and ultimately
radicalize them. Labor leaders lose no opportunity
to impress upon the military the belief that the
present relatively conservative unions stand as a
bulwark against communism and other leftist influence.
Opinion within the labor ministry echoes this
optimism. According to the US embassy in Buenos
Aires, ministry officials generally feel that the
junta will eventually decide to retain the basic
labor principles now in effect:
--Maintenance of a single labor central, the
General Confederation of Workers.
--Adherence to the practice of having only one
union for any given industry, and
--Prohibition of company unions.
Nonetheless, the embassy reports, it is widely
assumed that there will be measures to limit the
union's political role. The government, for example,
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may put strict controls on union funds, possibly as-
suming some of the social service functions long
performed by the unions.
President Videla knows as well as anyone else
that organized labor, more than any other group, has
the potential ability to undo much of what the junta
is striving to accomplish. By being off the job,
workers not only disrupt badly needed productivity,
but could undermine the junta's authority in a way
not even the terrorists can. This in turn would
stiffen the resolve of those officers who call for
punitive action against unions. Videla wants at all
costs to keep the nation from once again entering
this vicious circle.
Videla will probably opt for further token wage
hikes, perhaps at shortened intervals, and gradual
restoration of normal activity in some carefully
selected unions. Not even the relatively liberal
Videla, however, would countenance a return to the
freewheeling ways that characterized labor before
the coup. Videla will probably be strengthened in
his efforts by the creation of*the new ministry of
planning,which will coordinatethe policies of all
the other ministries and increase Videla's authority
over the government as a whole. The President will
also benefit if, as expected, he names the tough
General Diaz Bessone to the new post. Military
conservatives, with one of their own in the cabinet,
will not attempt soon to undermine Videla's efforts.
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