Economy, Environment, Tourism, violence

Abuses in Textile Maquilas and Hotels

Last Friday we posted that Northern Triangle and U.S. governments are proposing more neoliberal economic policies in order to create jobs and thereby address the emigration crisis and high levels of violence. Their plan, in part, is to attract more textile maquilas, agro-industries, manufacturing, and tourism. We think it’s a bad idea and will result in even greater inequalities and more emigration.

Over the past couple of days we came across a couple new articles that demonstrate why more sub-poverty minimum wage jobs in textiles, manufacturing, and tourism won’t address the serious issues that El Salvador and other Northern Triangle face.

Gangs and Maquilas

On Monday, the Inter Press Service (IPS) reported that employees of LD El Salvador, a Korean textile maquila that operates in San Marcos, just south of San Salvador, is using gangs and death threats to break up an employee union. One employee told IPS “They would call me on the phone and tell me to quit the union, to stop being a trouble-maker.” Another employee says, “they told me they were homeboys (gang members) and that if I didn’t quit the union my body would show up hanging from one of the trees outside the company.”

These are probably not empty threats. In January 2014 Juan Carlos Sánchez Luna, a member of SITS from the LD El Salvador maquila was assassinated. He began receiving threats at the end of 2013 after he participated in a press conference denouncing threats made against organizers at the LD El Salvador maquila. Less than a month later was gunned down in what officials classified as a “common crime.

Of the 780 employees at LD El Salvador, 155 used to belong to the Salvadoran Textile Industry Union (SITS, in Spanish). Since the threats began the number of union members has dropped to 60.

LD El Salvador is not the only company using gangs to prevent their workers from organizing. The IPS article references a report published in January 2015 by the Center for Global Worker’s Rights and the Worker Rights Consortium titled Unholy Alliances: How Employers in El Salvador’s Garment Industry Collude with a Corrupt Labor Federation, Company Unions, and Violent Gangs to Suppress Worker’s Rights. The report contains several accounts of maquilas using gangs to threaten and intimidate workers, and documents many other abuses.

As we pointed out last week, there is nothing in the Northern Alliance Plan that will protect workers rights and ensure that the very employers that are supposed to be part of the “solution” aren’t abusing workers and colluding with criminal organizations.

Tourism and Hotels

On Sunday, the Center for the Study and Support of Labor (CEAL, in Spanish) wrote an update on two hotels in Acajutla, Sonsonate. Both have long histories of abusing worker’s rights and the environment. The two hotels are the Vernaneros Hotel and Resort and the Decameron Salinas Hotel. Both tourism facilities have long histories of abusing workers rights and the environment.

Over the past several years, Vernaneros has faced several legal issues regarding the violations of El Salvador’s labor laws and the destruction of a valuable coral reef. In 2013, the Ministry of Labor found that Vernaneros owner Larry Alberto Zedán owed his workers $17,000 in compensation for not paying overtime, holidays, and overtime and other wages. Inspectors found that employees “worked most of the day, and in some cases 60 hours a week, but did not receive the minimum wage, did not have written contracts, and that [the hotel] operated informally with total disregard for labor standards.”

As a result of the abuses group of workers formed the Food, Restaurant, Hotel and Tourism Industry Union (SITIGHRA) with employees of The Decameron Hotel and other facilities. After they formed the union representatives wrote to the owners of several hotels and asked for a meeting. Larry Zedán responded by firing the 15 of his employees who had joined the union.

The Verdaderos has also received a lot of attention over the years for their destruction of a large reef off the coast from their resort. They destroyed the reef by installing a seawall to make their beach more pleasant for their guests. The reef, located in a region called Los Cóbanos, was the only place between Mexico and South America on the Pacific side, where coral grew.

The Decameron Hotel has its own share of labor disputes. In September 2013, the Decameron fired 145 workers for supporting the SITIGHR union, the same union that the Verdaderos employees had been fired for joining. One worker told Contrapunto in 2013 that they formed the union because “a lot of the bosses and supervisors treated us really poorly.”

These are just a couple of real examples in the news this week of what the globalized race to the bottom looks like. El Salvador needs solutions – economic inequality, emigration, and violence are all serious problems. But selling off the labor force and environment to the lowest bidder won’t resolve anything.

Related to these issues:

With regard to tourism, we came across a short peice on Cancun and what tourism development has done to local Mayan populations and environment. This is relevant for a lot of reasons, including that developers in El Salvador have proposed turning the Jiquilisco Bay into the “Cancun of Central America. Here is a link:

Our friends at CISPES are hosting an event in the DC area this week – Estela Ramirez, the General Secretary of the Salvadoran garment workers’ will be in DC this week to talk about their work. This will be a good opportunity to hear from on-the-ground organizers.

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agriculture, Economy, Equality, Food Security

More Neoliberal Economic Policies Will Not Stop Unaccompanied Minors From Seeking Refuge

DSCF0020March 2-3, Vice President Joe Biden was in Guatemala with leaders from El Salvador, Guatemala, Honduras, and the Inter-American Development Bank (IADB). Their agenda was to “accelerate the implementation of the Plan for the Alliance for Prosperity in the Northern Triangle (the Plan).” The meeting came just a month after Vice President Biden announced that the Obama Administration would ask Congress for $1 billion in aid for the region.

The purpose of the Alliance’s Plan, $1 billion fund, and the March meeting is to address the surge of unaccompanied minors leaving the Northern Triangle for the U.S. It’s an important goal. In FY2014, more than 60,000 youth were caught trying to enter the U.S. and government officials expect more than twice that in FY2015.

While the Plan arguably contains some constructive approaches towards decreasing violence, the emphasis is on implementing neoliberal economic policies. The proposal reads more like CAFTA-DR 2.0 or a World Bank structural adjustment plan, than an effort to stem the flow of emigration. The Northern Triangle and U.S. governments are proposing that foreign investment, more integrated economies, and free trade – and a gas pipeline – will provide the jobs and opportunities necessary to keep youth from seeking refuge in the U.S.

Income inequality and violence are the driving forces behind youth seeking refuge in the U.S., but its hard to imagine how more neoliberal economic policies, which many cite as the reason for inequality over the past 25 years, will do anything except ensure the region’s rich will remain so. A skeptic might even argue that the U.S. and Northern Triangle governments are using the “crisis” of violence and emigration in order to implement policies that further their own economic interests.

Increasing Foreign Investment and Investing in Our People

The Alliance Plan and other related documents emphasize that the solution to emigration, violence and inequality has to be economic – attracting foreign investment, unifying regional economies, increasing competitiveness in global markets, and training the workforce. The Plan, which was first published in September 2014, offers four Strategic Lines of Action. The first, and most detailed, is to stimulate the productive sector. The second is to develop opportunities for our people. Of the $1 billion grant from the U.S., $400 million will support these two lines of action.

Stimulating the productive sector means “attracting investment and promoting strategic sectors capable of stimulating growth and creating jobs… we will make more efficient use of our regional platform to reduce energy costs that stifle our industries and the national treasury, overcome infrastructural and logistical problems that curb growth and prevent better use of the regional market, and harmonize our quality standards to put them on par with what the global market requires.”

The Plan identifies four productive sectors: textiles, agro-industry, light manufacturing, and tourism, none of which are new to the Northern Triangle. Textile maquiladoras, sugarcane producers, factories, and tourism have exploited the region’s labor force and natural resources for years. They have created jobs, but ones in which workers are paid a sub-poverty minimum wage and endure a myriad of human rights abuses. Saskia Sassen wrote in 1998, and other since then report that so far the global economy has produced “a growing supply of poorly paid, semi-skilled or unskilled production jobs.” That has not changed in the past 17 years. When unions and workers try to negotiate better wages or working conditions, manufactures and investors simply leave. The environmental impacts of these sectors have been equally devastating, and will get exponentially worse if large-scale tourism, a gas-pipeline, and other industries are allowed to move forward.

While CAFTA-DR pretends to address labor and environment, and the “race to the bottom”, Northern Alliance governments provide detail about the concessions they will give to foreign investors. These include lower energy costs, infrastructure, and “harmonization” of standards, which some believe means an agreement on a very low bottom.

The U.S. and Northern Alliance countries have been implementing neo-liberal economic policies since the early 1990s; the same period that crime and gang violence began to proliferate. Privatization, dollarization, free trade agreements, maquiladoras, Millennium Challenge Corporation grants, Partnership for Growth, Public-Private Partnerships, and more have all been implemented over the past 25 years. The same period that crime and violence has skyrocketed.

As academics (good articles here and here) and campesino leaders in rural El Salvador, Guatemala, and Honduras have articulated for years – globalization and neoliberal economic policies are the reason for the high rates of inequality that has resulted in the high levels of crime and violence, and lack of opportunities that have forced youth to flee. Poverty and inequality are nothing new in the Northern Triangle, but Globalization and neoliberalism is simply the latest tools the elite use to maintain and grow their wealth.

Just this week, El Faro published an article titled “The Neoliberal Trap: Violent Individuals or Violent Situations ” that is based on 2013 study in El Salvador. The authors found that communities that are more isolated from the global community and depend sustenance agriculture were less likely to experience social isolation, gangs, crime and violence. Communities that have a greater market mentality are more socially isolated and prone to crime. The article argues, “The neoliberal reconstruction has renewed and amplified the conditions of alienation. Meanwhile, some elites embrace neoliberal reconstruction as a means of assuring their position in the new “transnational capital class of global capitalism, while a large part of the population is left out and has to fend for themselves.”

Colette Hellenkamp drew a similar conclusion in her piece War and Peace in El Salvador. She concludes, “The wealthy few in [the El Salvador] do whatever is necessary to maintain their riches and quench their thirst for comfort and power. Their status and wealth will not be threatened as long as they ensure that the masses remain uneducated and in chaos.” The crime and violence in El Salvador has certainly caused such chaos that instead of opening small shops and providing services the region’s otherwise hard-working and industrious workforce is leaving en masse.

Academics also point out that proponents of neo-liberal ideologies believe their model is perfect – “everyone benefits, not just some, all.” Those that don’t are referred to as the “underserving poor or the underclass that demonstrate two characteristics – they are underserving and predisposed to unlawful behavior. Proponents argue that free market, neoliberalism is perfect and if people don’t benefit, its not the market’s fault, it’s because people are lazy and prone to violence.

The Northern Alliance Plan is to double down on the neoliberal policies that sustain the same economic inequalities they say they are want to correct. Bur more sub-poverty, minimum wages will only serve to further stratify the economic and social classes.

Albert Einstein said, “We can not solve our problems with the same level of thinking that created them.” But that’s what the Northern Triangle Plan seems to want to try and do.

Violence and Security

Instead of focusing on more neoliberal economic policies, the Plan must focus on putting an end to the high rates of crime and violence.

Analysts agree that most of the youth detained on the U.S. border were fleeing violence. A report published by the UN High Commissioner for Refugees found that 58% of the minors interviewed “were forcibly displaced because they suffered or faced harms that indicated a potential or actual need for international protection.” The report identified two sources of violence – “organized armed criminal actors and violence at home.” A report written by Fulbright Fellow Elizabeth Kennedy found, “59 percent of Salvadoran boys and 61 percent of Salvadoran girls list crime, gang threats, or violence as a reason for their emigration. Whereas males most feared assault or death for not joining gangs or interacting with corrupt government officials, females most feared rape or disappearance at the hands of the same groups.” Other reasons for leaving included the lack of economic opportunities and reunification with family members in the U.S. But of those youth, “most referenced crime and violence (the chaos) as the underlying motive for their decision to reunify with family now rather than two years in the past or two years in the future.”

The proposal for decreasing violence in the Northern Triangle is a mixed bag at best. The Plan wants to invest more money into the same heavy-handed, militarized, law enforcement policies that have been failing for 25 years. Alexander Main provides a good critic of these policies in his Truthout article, Will Biden’s Billion-Dollar Plan Help Central America.

But its not all bad. There are some proposals in the Plan that focus on alternative conflict resolution, safe schools, trustworthy community policing, modernizing the justice system, and giving civil society and churches a greater role in prevention and rehabilitation. There are also needed reforms for ensuring better governance and addressing organized crime. One of the more positive ideas is to “improve prison systems, including infrastructure based on prisoner risk profiles, the capacity of prison staffs, and rehabilitation programs, including those focused on juvenile offenders and their prison conditions.”

El Salvador has even proposed an ambitious $2 billion plan that proposes similarly progressive policies for ending violence at the national level. The plan “promises parks, sports facilities, education and training programs for the country’s 50 most violent municipalities, as well as improvements to the worst prisons where the country’s biggest gangs – Mara Salvatrucha 13 (MS13) and Calle 18 – have proliferated over the past decade.”

If implemented, these projects could help decrease levels of crime and violence, and calming the chaos that helps maintain high levels of inequality. But if academics and campesino leaders are right, and globalization is the cause of the inequality, these positive steps are unlikely to have any lasting impact. The undeserving poor will still be limited to working sub-poverty wages and have little if any social and economic mobility.

If Not More Neoliberal Economic Policies…

Stemming the flow of emigration is a complex task, and the Northern Triangle and U.S. governments are right to consider a multi-faceted approach that aims to provide economic opportunities, end violence, and address other deficiencies.

Instead of more neoliberal economic policies, the Northern Triangle and U.S. governments, and the IADB should focus their plan on making the region safe from crime and violence. There are very smart, informed civil society leaders who have put forth some very reasonable proposals. The governments should do more to work with them to implement their ideas and proposals on a large scale. The plan articulates some of these ideas, but instead of taking second place to more neoliberalism, they should be at the heart of the proposal.

The solution should include creating economic opportunities, but that does not require foreign investors or selling out the region’s workforce and environment. Salvadorans, Guatemalans, and Hondurans are known as hardworking and industrious. Instead of building infrastructure and providing incentives to multinational corporations, the governments should focus those investments on supporting and incentivizing local, small businesses. That does not mean small business loans, but it might mean making it more difficult for international corporations like Walmart to run all the mom-and-pop shops out of business. Family businesses do more than provide jobs; they build neighborhoods and social networks.

Instead of promoting agro-industry and exports, as proposed by the Plan and Partnership for Growth, governments should support communities in their efforts to promote food security and sovereignty. El Salvador’s family seed program, for example is an example of a relatively low cost government action that supports small family farmers that are trying to feed their family and contribute to their local economy. In 2013, the United Nations Conference on Trade and Development called for a “rapid and significant shift from conventional, monoculture-based and high-external-input-dependent industrial production towards mosaics of sustainable, regenerative production systems that also considerably improve the productivity of small-scale farmers.”

There are solutions. The only question is motive and whether policy makers are really interested in addressing emigration, violence, and economic inequality, or using the chaos and “crises” as means to further their own economic interests. This month, President Sanchez Cerén and the Legislative Assembly declared March 26 as the National Day of Peace, Life and Justice – a day in which all Salvadorans will unite and demand an end to the violence and chaos. But even this simple idea of bringing people together was too much for the business class. ANEP (El Salvador’s Chamber of Commerce) came out against the Day of Peace, Life, and Justice, argues that celebrating a National Day of Peace would cost El Salvador $56 million in lost economic opportunities. ANEP representatives argue, “the suspension of just one day of work will cost Salvadorans more that 56 million dollars, and could result in the loss of contracts from export businesses, and thus the employment of workers.”

Their position could be one of pure practicality. More likely it is a true reflection of their priorities – money and profits over peace, life, and justice.