Friday, December 19, 2008
The default on the Global Bonus 2012 bonds means that Ecuador is also defaulting on Global 2015 and 2030 bonds. The default totals $9.937 billion, 19 percent of the country's GDP. Ecuador has assembled a legal team to fight expected lawsuits and hopes to use the default as leverage to renegotiate the debts.
Civil society organizations have long criticized foreign debt as a means of exploiting impoverished countries in Latin America, Africa and Asia. The anti-debt organization Jubilee USA says "countries are paying debt service to wealthy nations and institutions at the expense of providing these basic services to their citizens." In addition, lending institutions often use indebtedness to force cuts in social spending and impose business friendly economic policies.
The Confederation of Ecuadorian Kichwas (ECUARUNARI), the powerful Andean branch of the country's indigenous peoples movement, has long called the foreign debt illegal and illegitimate. "We have not acquired any debt. The so-called public debt really belongs to the oligarchy. We the peoples have not acquired anything or been benefited, and thus we owe nothing."
Mainstream analysts immediately predicted the move would hurt Ecuador economically, cutting off access to international credit from banks and multilateral institutions like the World Bank. Enrique Alvarez, head of research for Latin America Financial Markets at IDEAglobal in New York, told the Associated Press, "They were already sort of headed into isolation. Essentially now they've drawn shut the gate." Critics also say that financial institutions will see Ecuador as risky and may be reluctant to loan to the country's private sector.
But Mark Weisbrot of the Center for Economic and Policy Research argues that those claims are exaggerated. He says that the government does not currently require foreign funds and that any decision to not lend to Ecuador's private sector would be purely ideological. "Ecuador doesn't need to borrow right now, especially if they're not paying the debt. They haven't been borrowing on international markets recently."
Osvaldo León of the Latin American Information Agency (ALAI) in Quito says that international banks and businesspeople are defending a corrupt and unjust system. "Of course the establishment is going to come out and protest this. This is going to affect the interests of capital. There's going to be an offensive from both inside and out." He charges that business friendly economists and financiers unfairly frame their arguments as scientific and opponents' views as ideologically driven. "Ecuador has decided on a political response to a political problem. They always want things like this to be seen as a technical issue, a problem that only economists can deal with."
Although Ecuador currently has the capacity to pay, dropping oil prices and squeezed credit markets are putting Pre sident Rafael Correa's plans to boost spending on education and health care in jeopardy. Correa has pledged to prioritize the "social debt" over debt to foreign creditors.
Ecuador is undertaking a diplomatic offensive in an effort to win political support. Correa will be attending a summit in Brazil next week with presidents from throughout Latin American and Caribbean. Ecuador has called on Latin America to forge a united response to foreign debt. Venezuela, Bolivia and Paraguay have recently created debt audit commissions. Ecuador has also asked the United Nations to help develop international norms to regulate the foreign debt market.
But relations between Brazil and Ecuador have been tense since the September expulsion of the Brazilian firm Odebrecht over accusations of shoddy work on a hydroelectric plant and contract violations. Most recently, Ecuador filed suit in the International Chamber of Commerce to stop payment on a $286 million debt to the Brazilian National Bank for Economic and Social Development (BNDES), credit that was allotted for Odebrecht's hydroelectric project. Many activists in Ecuador see Brazil as a regional bully.
Last month, a special debt audit commission released a report charging that much of Ecuador's foreign debt was illegitimate or illegal. The commission found that usurious interest rates were applied for many bonds and that past Ecuadorian governments illegally took other loans on. The report also accused Salomon Smith Barney, now part of Citigroup Inc., of handling the 2000 restructuring without Ecuador's authorization, leading to the application of 10 and 12 percent interest rates. Ecuador's military dictatorship (1974-1979) was the first government to lead the country into indebtedness.
Commercial debt, or debt to private banks, made up 44% of Ecuador's interest payments in 2007, considerably more than the 27% paid to multilateral institutions such as the International Monetary Fund (IMF).
Daniel Denvir is an independent journalist in Quito, Ecuador and a 2008 recipient of NACLA's Samuel Chavkin Investigative Journalism Grant. He is an editor at www.caterwaulquarterly.com.
Saturday, December 6, 2008
Chicago factory occupied by UE Workers
Lee Sustar reports from Chicago on an occupation by workers who want what's theirs from management and the Bank of America.
December 6, 2008
WORKERS OCCUPYING the Republic Windows & Doors factory slated for closure are vowing to remain in the Chicago plant until they win the $1.5 million in severance and vacation pay owed them by management.
In a tactic rarely used in the U.S. since the labor struggles of the 1930s, the workers, members of United Electrical, Radio and Machine Workers of America (UE) Local 1110, refused to leave the plant on December 5, its last scheduled day of operation.
"We decided to do it because this is money that belongs to us," said Maria Roman, who's worked at the plant for eight years. "These are our rights."
Word of the occupation spread quickly both among labor and immigrant rights activists--the overwhelming majority of the workers are Latinos. Seven local TV news stations showed up to do interviews and live reports, and a steady stream of activists arrived to bring donations of food and money and to plan solidarity actions.
Management claims that it can't continue operations because its main creditor, Bank of America (BoA), refuses to make any more loans to the company. After workers picketed BoA headquarters December 3, bank officials agreed to sit down with Republic management and UE to discuss the matter at a December 5 meeting arranged by U.S. Rep. Luis Gutierrez (D-Ill), said UE organizer Leah Fried.
BoA had said that it couldn't discuss the matter with the union directly without written approval from Republic's management. But Republic representatives failed to show up at the meeting, and plant managers prepared to close the doors for good--violating the federal WARN Act that requires 60 days notice of a plant closure.
The workers decided this couldn't go unchallenged. "The company and Bank of America are throwing the ball to one another, and we're in the middle," said Vicente Rangel, a shop steward and former vice president of Local 1110.
Many workers had suspected the company was planning to go out of business--and perhaps restart operations elsewhere. Several said managers had removed both production and office equipment in recent days.
Furthermore, while inventory records indicated there were plenty of parts in the plant, workers on the production line found shortages. And the order books, while certainly down from the peak years of the housing boom, didn't square with management's claims of a total collapse. "Where did all those windows go?" one worker asked.
Workers were especially outraged that Bank of America, which recently received a bailout in taxpayer money, won't provide credit to Republic. "They get $25 billion from the government, and won't loan a few million to this company so workers can keep their jobs?" said Ricardo Caceres, who has worked at the plant for six years.
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THE MEMBERS of Local 1110 have a history of struggle. In 2004, they decertified the Central States Joint Board--a union notorious for corruption and sweetheart contracts with management--and brought in UE, a far more democratic organization.
In May of this year, Local 1110 mobilized for a contract by organizing a "practice" picket, and 70 workers used their lunch break to confront the boss with a petition listing their demands. The workers were able to turn back company's effort to win major concessions and won solid pay increases.Now, management is trying to get revenge by pocketing money that belongs to the workers.
UE officials and workers acknowledge that it will be difficult to stop the plant from closing. But they're determined to get the money owed to them--and they believe that by fighting, they can set an example for other workers facing layoffs and plant closures as the recession deepens.
Negotiations are set for Monday, December 8. Whatever happens, however, the workers have already sent a message to employers that if they violate workers rights and the law, they can expect a fight.
"This is a message to the workers of America," said Vicente Rangel, the shop steward. "If we stand together, we will prevail until justice is done, and we get what we're due."
Members of Local 1110 need your support. Make checks payable to the UE Local 1110 Solidarity Fund, and mail to: 37 S. Ashland, Chicago, IL 60607. Messages of support can be sent to firstname.lastname@example.org. For more information, call UE at 312-829-8300.
At the Jobs with Justice Web site, you can send a message of protest to Bank of America.
Friday, December 5, 2008
RootsCamps are participant driven events or forums, using the "unconference" or "open space" format that is born from the desire for activists, organizers, leaders and politicians in the progressive sphere to share and learn in a productive, fast-paced, open environment.
Think of it as a cross between an election debrief and grassroots organizing skills share. The progressive community — everyone from the "netroots" to precinct captains to field organizers to national message consultants — come together to share successes, failures, impart old wisdom and new discoveries.
RootsCamp is an intense event with discussions, demos, and interaction from participants. There are NO SPECTATORS. This open format never fails to yield an astounding exchange of information, spin-off projects, and cross-pollination among unexpected partners.
Find out more about RootsCampPittsburgh at http://rootscamppittsburgh2009.pbwiki.com/
When is RootsCampPittsburgh? RootsCamp will be held at the United Steelworkers Building, 5 Gateway Center in Pittsburgh on January 24, 2009.
Who should come to RootsCamp? RootsCamp will be for anyone who played a role in the 2008 elections and/or working in progressive politics. As fellow organizers, we'll be meeting each other, reuniting with team members, discussing the innovations and challenges from this cycle, and most importantly, celebrating!
RootsCamp 2009 will bring together the best and brightest organizers that were engaged in 2008 campaigns, including staff and volunteers from:
Down ballot races
Non-partisan GOTV and voter registration operations
Blogs and other media
Media, message, polling and targeting consultants
At RootsCamp, you will:
· Share stories and knowledge with each other from all over Pennsylvania, especially the western part of the state.
· Teach others from the progressive movement what you did and how you did it. Brainstorm ways that the methods you practiced can be exported to unions, advocacy organizations and community organizations.
· Strategize about how to help progressive institutions to sustain what you've started.
To find out more about RootsCampPittsburgh or to register, go to: http://rootscamppittsburgh2009.pbwiki.com/
by Stephen Crocket
Senator Shelby (Republican-Alabama) has a very negative record when it comes to protecting the economic health of the American nation. He has routinely endorsed every major, so-called “free trade” deal that has been proposed for decades. Shelby has routinely stood in the way of government provided, universal healthcare proposal for decades. Now, Shelby (like most other Republican Senators with similar voting records) is blocking the federal bridge loans to the American auto companies designed to save the American auto industry.
The stakes are huge. A million auto worker retirees have their healthcare and pensions put at risk by Shelby’s unpatriotic and reckless actions. The ripple effect of not approving the loans could destroy one out of ten jobs in the American economy.
Political and economic pundits along with most officeholders have refused to link the economic crisis facing the auto industry to government policy. The situation facing the auto industry is more a result of bad government policy than bad management decisions. The attempt by politicians like Shelby to blame labor unions is factually wrong and, in my opinion, intentionally dishonest. Shelby and his Senate allies created this auto industry crisis by adopting economic policies that have crippled the American economy.
All industrialized nations except the United States has government provided, universal healthcare. Only in America, do we place the costs of workers’ healthcare and their families’ healthcare on the backs of employers. This puts our employers at a huge competitive disadvantage with foreign corporations.
At the same time, foreign governments have helped their auto manufacturing in terms of research and development (R&D) much more than the American government has in recent decades. Senate Republicans have routinely placed the profits of HMO’s, drug companies and insurance companies over the health of American manufacturing. Shelby has undermined both the personal health of hundreds of millions of American citizens and our industrial base for decades.
Our nation spends 17% of our total economy on healthcare. We have 47 million uninsured and many more underinsured citizens. Our industrial competitors in Europe, Asia and Canada spend on 8% of their economies on healthcare. They cover all their citizens healthcare needs.
Without government provided, universal healthcare, it is economic death for American manufacturing to open up our borders to so-called “free trade” with nations who provide such healthcare to their citizens. Shelby and his Republican Senate allies are trying to murder American manufacturing.
The auto industry bridge loans are badly needed. Failure to pass these loans would be more than just irresponsible. It would be a threat to our economic and military national security. We cannot remain a major military power without a vibrant industrial base especially in vehicle manufacturing.
We need to address the long-term government policies that created the current crisis after approving the auto industry bridge loans. We must either adopt government provided, universal healthcare by passing legislation like the Medicare For All Bill (HR 676) or ending tariff free imports in manufactured goods. We need to adopt a Re-Industrialization Policy designed to restore our economic health in the world economy. We must end the political dominance of the economic elite in our federal government by replacing politicians like Shelby with economic patriots who actually care about working Americans and national security.
Written by Stephen Crockett (host of Democratic Talk Radio http://www.DemocraticTalkRadio.com and Editor of Mid-Atlantic Labor.com http://www.midatlanticlabor.com). Mail: 698 Old Baltimore Pike, Newark, Delaware 19702. Phone: 443-907-2367. Email: email@example.com.
Feel free to publish without prior approval.
Thursday, December 4, 2008
So now it’s official. We’re in a recession. People like us have known that for a while. We’ve watched neighbors and family members worry about losing their jobs or their homes. We’ve seen real wages decline for working families. And we’ve watched Congress bail out the banks and finance companies as a way to stimulate the economy.
But in this time of bailouts, there’s one economic stimulus solution the politicians aren’t talking about: Give workers the freedom to form a union without illegal or coercive interference from powerful employers and their special interest backers.
When workers are free to choose to join a union, our economy can work for everyone again. That’s why we need the Employee Free Choice Act—a bill in Congress that would help to level the playing field and give workers the freedom to choose a union.
- According to American Rights at Work, the Employee Free Choice Act (EFCA) would:
Help America’s working families improve their standard of living. Workers in unions earn 30 percent higher wages and are 59 percent more likely to have employer-provided health insurance.
- Fix a broken system that gives corporations far too much power. When workers try to organize unions, they are often harassed and intimidated; 25 percent of companies unlawfully fire pro-union workers.
- Restore fairness and the promise of the American Dream, with a robust middle class, economic growth, and shared prosperity.
EFCA is a simple solution that is supported by a bipartisan coalition in Congress that includes Senator Bob Casey.
Unfortunately, Senator Arlen Specter has not chosen which side he’s on. In an article he wrote for the Harvard Journal on Legislation Sen. Specter declared that he has too many questions about allowing workers to freely organize a union in their workplace to better their wages under EFCA.
Keystone Progress wants to help Sen. Specter make up his mind.
Executive DirectorKeystone Progresswww.keystoneprogress.org