While Techint has enjoyed multi-million dollar profits, the workers in the plant have suffered increased deaths and injuries in accidents. The president of the steelworkers’ union SUTISS has described the ten years of privatization as years of "humiliation and ill treatment”. For more than 15 months SUTISS has been bargaining for improvements in wages, pensions, working conditions and health and safety, but the company has played hardball. Spontaneous walkouts and work stoppages resulted.

The Venezuelan government got involved. The Ministry of Labour tried to impose binding arbitration on SUTISS. Then, on March 14 this year the National Guard, acting on the direct orders of SIDOR management, launched a vicious attack on the striking steelworkers, injuring and arresting many of them.

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The old state apparatus, created and perfected over 200 hundred years to serve the interests of the ruling class, although weakened by the revolution, is still basically intact, and it is still attempting to serve the same interests.

As a Bolivarian MP for Guayana said: "I consider these abuses to be a long way from the revolutionary principles promoted by the President of the Republic." El Zabayar, who came out publicly for the nationalization of SIDOR further explained that, "There are sectors within the state that play at wearing down the government, using governmental authorities to assume a pro-bosses attitude". This is precisely the problem: the state apparatus remains largely the same, and a capitalist state cannot be used to carry out a socialist revolution.

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This intervention by Chávez through the vice-president was in fact a slap in the face to the regional governor and above all to the Minister of Labour, Rivero. Their authority was superseded and the government sided clearly with the workers. The company, which until that moment had said that they would not talk to the workers again, agreed to a new meeting.

A three party meeting between the company, the union and the vice-president took place on Tuesday 8th, in which the company made minor concessions. Just after midnight, the vice-president Carrizales, who had said that the meeting could not end without an agreement, asked the company one last time if they were not prepared to make a counter-offer to the union's final offer on wages, and when the company refused he asked this to be recorded in the minutes. He then stepped out, called president Chávez and came back to the meeting to announce the re-nationalization of SIDOR.

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This is yet another turning point in the Venezuelan revolution and a clear indication of the direction it should take. This is not a small bankrupt company that has been taken into public ownership, but the country's only supplier of steel and Latin America's fourth largest producer. This decision is likely to provoke a backlash on the part of the multinational and also on the part of the Argentinean government which in the past has put a lot of pressure on Chávez in defence of Techint. The Venezuelan revolution and its supporters abroad, particularly in Argentina, must be ready to withstand this pressure and launch a campaign in defence of this nationalization. The workers of SIDOR should take immediate steps to implement workers' control in order to prevent the company from engaging in any kind of sabotage, seize the installations, control the stocks and above all they should proceed to open the account books of the company….

The re-nationalization of SIDOR is another step forward in the right direction. In the last few months, the oligarchy has stepped up its campaign of sabotage of the economy, particularly the food distribution sector. At the same time imperialism has increased its provocations, threatening to put Venezuela on the list of countries that "harbour terrorism". It is now time to take decisive steps forward by nationalizing the fundamental levers of the economy under the democratic control of the workers and finally completing the revolution.

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CARACAS, April 9 (Reuters) - Venezuela's President Hugo Chavez has ordered the nationalization of a large foreign-owned steelmaker, extending a wave of takeovers meant to create a socialist state in the oil-exporting South American country.

Just days after Chavez announced the takeover of the cement industry, his government said on Wednesday that steelmaker Ternium Sidor would fall back into state hands, sending the Argentine-controlled company's shares tumbling.

Chavez increased state control of swathes of the economy in a multibillion-dollar campaign last year but paused in recent months to focus on crime and trash collection after voters rejected his push for wider powers in a December referendum.

Venezuela's Vice President Ramon Carrizalez accused parent company Ternium of showing more concern for its plant machinery than its workers in a fierce labor dispute that prompted the takeover of the country's largest steelmaker.

He said that the firm would be compensated and could even stay on as a minority partner.
"In this government, the worker comes first," Carrizalez said while announcing the takeover of the steelmaker, which Ternium says represents a quarter of its total sales.

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[ 06 May 2008: Message edited by: M. Spector ]

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The Vice President described Sidor’s refusal to budge on its final wage offer, which had been rejected in a worker-led referendum the week before, as “a grand arrogance” reflective of “a colonizer attitude” of a company that wished to continue its “barbarous exploitation” of its workers.

“This is a government that protects workers and will never take the side of a transnational company,” said Carrizalez, who assured that the decision would not affect Venezuela’s relations with Argentine President Cristina Fernández.

The president of Sidor’s Board of Directors, Maritza Izaguirre, said allegations of Sidor’s wrongdoing are “not true.” The company has been “submitted to constant supervision and auditing of its management by organisms of the state,” Izaquirre assured, and its conduct has been “bound to the strict compliance” with Venezuelan law.

Union members are “jubilant” and celebrating, SUTISS finance secretary José Meléndez announced Wednesday, calling the nationalization a step toward “the workers’ dream of the Socialism of the 21st century”.

Since Chávez sent Carrizalez to renew negotiations with Sidor last Sunday, the workers were demanding a daily pay increase of 53 bolivars ($24.65) compared to the company’s offer of 44 bolivars ($20.50), and the doubling of retirement pensions which are currently half the minimum wage, Meléndez said in an interview with the Marea Socialista national union current Wednesday.

Also, union negotiators sought to include a portion of Sidor’s approximately 9,000 non-unionized contract workers, who are subject to “completely unsafe conditions… miserable salary, without health care or job security,” in the disputed collective contract, which currently involves 4,035 permanent employees, Meléndez explained.

Implying support for this demand, Chávez recounted Sunday the law he decreed on May 1st last year against the undercutting of unions by companies that increase their contract labor force.

In negotiations Tuesday, Sidor offered to bring on 600 contract workers, but refused to budge on wages and pensions. Meléndez said this “was truly a mockery that we could not accept.”

Shortly after the nationalization was announced, Paolo Rocca, the president and top shareholder of Techint, an Argentine conglomerate which owns 60% of Sidor, sent a letter to Chávez requesting a “constructive solution” to avoid nationalization. In the missive, Rocca offered a pay raise nearly equal to the workers` demand and agreed to increase pensions to minimum wage, but did not alter its position on contract labor, according to the Venezuelan daily El Nacional.

“I am as of now at your disposition for that which you stipulate,” Rocca wrote to the President, who had threatened to nationalize the company in 2007 but did not once the company agreed to prioritize supplying steel to the national market.

SUTISS General Secretary Nerio Fuentes said workers would be “flexible” during the transition from private to state control, but it is “vital” that working conditions improve and collective contract negotiations proceed quickly.

Fuentes assured that the workers are prepared to occupy and operate the steel plant at full capacity while the nationalization is negotiated, but will wait for the government to give the go-ahead.

It is possible that the government and Techint switch places as shareholders in Sidor, leaving the conglomerate with a 20% share, the government with 60%, and the workers with the 20% share they have now, Carrizalez told the press Wednesday. No official indemnity offer has been made.

Meléndez said the workers hope the company will be placed “under control of the workers and the People.”

The union leader expressed deep disappointment that before Chávez weighed in on the side of the union, the Venezuelan Labor Ministry “never tried to look for a solution favorable to the workers” in the face of the “abuses the transnational commits,” but instead “attack[ed] the workers and its union organizations,” referring to the violent repression of a March 14th worker strike after the ministry backed company proposals.

Stalin Pérez Borges, coordinator of the pro-Chávez National Workers Union (UNT), said the ministry had been “mistaken to forget that we are the brave People of April 13, we have dignity,” referring to the day masses of Venezuelans took to the streets to return Chávez to power after a two-day coup in 2002. - Venezuelanalysis

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Originally posted by M. Spector:
The Ministry of Labour tried to impose binding arbitration on SUTISS.

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In a decision announced late Tuesday night, Venezuelan President Hugo Chavez dismissed Labor Minister José Ramón Rivero....

The move appears to be a repudiation of recent actions of the Labor Minister, who only two days prior, held a joint press conference with one faction of the National Union of Workers (UNT) — the Bolivarian Socialist Workers Force (FSBT) — and announced the formation of a new national labor federation calling on unions to disaffiliate from the UNT.

Rivero, (a member of the FSBT) publicly attacked the UNT in an interview with regional daily Notitarde on April 11, saying "The National Union of Workers does not represent the spirit of the Venezuelan revolutionary process."

Rivero had also recently presided over negotiations between the management of Venezuela's largest steel plant, the Argentine controlled SIDOR, and the United Steel Industry Workers Union (SUTISS) in a long running and bitter dispute for a collective contract.

However, the former minister became widely discredited among the SIDOR workers and was accused of violating union autonomy after he attempted to impose a company run referendum on the management’s final pay offer or face arbitration.

The ongoing conflict provoked the intervention of President Chavez last week, who overrode the Labor Minister and ordered the steel plant to be re-nationalized. Rivero was subsequently sidelined from collective contract negotiations between the government and the SIDOR workers, responsibility for which has been assigned to Vice-president Ramon Carrizales....

Marcos García, a coordinator of public sector union FENTRASEP said “The workers movement, with the triumph of the SIDOR workers and the people of Guayana, who achieved the nationalization of the principal steel producer in Latin America, has produced a change throughout the country.”

“This triumph has helped so that a policy of deepening the process can be developed, so we can attack old problems and resolve the necessities of working people. Now, finally, an emblematic company has returned to the hands of the Venezuelan people.”

The attempt by the former Labor Minister to “decree a new divisionist, sectarian, bureaucratic, and pro-bosses union federation” was a desperate measure, but “no-one will accompany him apart from a few accomplices from his own current, the FSBT, who have been repudiated by the majority of workers,” Garcia continued.

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If a “just” price is not agreed upon this Tuesday for the nationalization of the Sidor steel plant, Venezuelan President Hugo Chávez will sign a presidential decree expropriating the company, Chávez declared on his weekly Sunday talk show Aló Presidente.

An indemnity dispute has stalled negotiations between government ministers and officials from the Argentine company Ternium, which owned 60% of Sidor operations prior to the April 9th nationalization.

The Techint group, which controls Ternium, has estimated the value of its shares in the company to be $3.6 billion. Venezuela’s Minister of Basic Industries and Mining, Rodolfo Sanz, said the payment should be no more than $800 million, according to a thorough “economic diagnosis of the company” conducted by the government’s negotiating team.

“What do the owners of this company think, that we are morons?” asked Chávez Sunday. About the company’s indemnity proposal, Chávez commented, “I laughed at that. I am not going to pay that amount because this company is not worth that much.”

According to the Argentine daily Clarín, Techint seeks compensation for the opportunity cost, not just the market value of the company. Techint claims its indemnity estimates reflect the cost of purchasing another plant similar to Sidor, possibly in Brazil.

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April 30 - Bloomberg - Venezuelan President Hugo Chavez signed a decree to nationalize Luxembourg-based Ternium SA's local steelmaking unit and said he would create a commission to take control of the company.

Chavez said he would send the decree to the Supreme Court to be validated, in comments broadcast by state television. The president announced plans this month to assume control of Siderurgica del Orinoco, Ternium's subsidiary and Venezuela's biggest steelmaker.

The company said today in a statement that Venezuela could decide to expropriate the assets of Siderurgica del Orinoco, or Sidor, as the Ternium subsidiary is known. Chavez, a self- proclaimed socialist, has increased state control this year of what he says are ``strategic'' industries of the economy.

``We're going to transform Sidor into a socialist company,'' the president said today. Chavez has the power to pass laws by decree, without going through legislators.

Chavez decided to take over the steelmaker after management failed to reach a new labor contract with union workers. Chavez said today that the government is close to reaching an agreement with the union.

The Venezuelan government has valued Sidor's assets at $800 million. Chavez has said he won't pay what Ternium is seeking in compensation, which he said was between $3 billion and $4 billion.

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Takes Two to Tango

I'm sure you've read this M. Spector but I'd be interested in your take on that analysis.

[ 01 May 2008: Message edited by: It's Me D ]

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The United Steel Industry Workers Union (SUTISS), representing more than 4,000 steel workers at the recently nationalized SIDOR steel plant, and the Venezuelan government finalized a collective labor contract early Sunday morning. The deal brings to a close 16 months of negotiations ridden with work stoppages, fierce media campaigns, violent repression against workers, and the government’s nationalization, on April 9th, of Ternium, the Argentine conglomerate which had owned 60% of SIDOR since 1997.

“The workers feel that what we achieved was a great triumph,” said SUTISS Finance Secretary José Meléndez amidst celebrations in the streets of Guayana city, where the steel plant is based. The contract, valid until the year 2010, is a “precedent” for workers nation-wide, and is one of the best in Latin America, according to Meléndez. …

The contract guarantees an initial daily wage increase of 33 bolivars ($15.35) and two additional increases of 10 bolivars ($4.65) by 2009, and satisfies worker demands for back-wages, overtime pay, incentive pay, and paid vacations. It also doubles retirement pensions and guarantees that the company will pay for 90% of the health benefits of the retired, and 80% of the health care of active workers.

The part of the contract which gives SUTISS representatives “the greatest happiness” is the incorporation of 800 of SIDOR`s 9,648 non-unionized contract workers into the union immediately, and the commitment to solidify a plan within three months to gradually incorporate the rest, Meléndez said.

Meléndez vowed that the workers will now be dedicated “body and soul” to turning the steelmaker into a “pillar for the revolution on the path to socialism.”

The workers have already increased production at the plant, Meléndez claimed, which demonstrates that “when we, the workers, are treated like human beings, when our dignity is respected, we are capable of making enormous efforts in support of the revolution.”

However, Meléndez assured that the union will be “pushing for the workers to control the democratic management of the new SIDOR,” even if the company is owned by the government.

The sentiment was echoed by Marcela Máspero, coordinator of the union current Collective of Workers in Revolution (CTR), who told the union press Sunday that “the management model should be a product of discussion and the protagonistic participation of the workers… ALL THE SIDOR WORKERS,” including the entire body of contract workers. - Venezuelanalysis

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Contract workers from Venezuela’s recently nationalized SIDOR steel plant were declared permanent workers and incorporated into the United Steel Industry Workers Union (SUTISS) Tuesday, in accordance with the collective contract that SUTISS signed with the government in early May, following 16 months of embattled negotiations with the previous private management.

“We have placed one more stone in the construction of a world model of Socialism of the 21st Century,” President Hugo Chávez declared during the ceremony in the Miraflores presidential palace in Caracas.

An initial group of 216 contract workers were incorporated into the collective contract Tuesday, out of a total of 1,248 who are on track to obtain permanent status in a gradual process laid out in clause 97 of the contract.

Chávez announced that the new SIDOR will become a “socialist” enterprise run by the government together with the workers. “This is an historic day, on which the working class continues converting itself into the vanguard of the Venezuelan people and the Bolivarian Revolution,” the president boasted.

Chávez also called on the SIDOR workers, who are now seasoned revolutionary organizers, to help make the plant function like a “socialist worker school” for the rest of Venezuela.

SUTISS General Secretary José “Acarigua” Rodríguez assured during the ceremony that the union will be fully committed to the government’s national development plans.

“We are profoundly convinced that we should join forces, the workers and the government, to move this industry forward,” Rodríguez remarked....

The president emphasized the need to “bury” exploitative contract work, “just like we are burying capitalism and neo-liberalism.” Under private management since 1997, approximately 9,500 SIDOR workers were pushed out of fixed positions and into precarious, benefit-less contract work, deflating union membership to 4,000.

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On August 27, Venezuelan President Hugo Chavez announced the end of negotiations with former owners Ternium over the nationalisation of the Sidor steel factory, stating that the government would “take over all the companies that it has here”, insisting Ternium “can leave”.

Speaking during a televised broadcast, he argued that the reason behind the decision was the fact that Ternium “did not recognise our sovereignty”.

“The deadline for reaching an agreement has expired, we will move ahead and pay them what it really costs, more over it will not be all in one go as they wanted. No, we will pay them at a pace that we can pay them.”

Until the April 9 decision to nationalise Sidor, the Ternium consortium, whose biggest shareholder is the Italian-Argentine transnational Techint, had 60% control of one of the largest steel factories in Latin America, located in the industrial state of Bolivar.

Having seemingly reached an agreement on a settled price the previous week, Chavez stated that Ternium had tried to impose unacceptable conditions — including the passing of a law giving the transnational immunity from any possible future lawsuits as a consequence of abuses committed by Ternium against the Sidor workforce.

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