“We’re going to use the Olympics as the channel through which we can show our protest. The whole world will see what Rio’s like at the moment, and feel ashamed. Some people have tried to say our protests and our strikes aren’t fair because athletes spend months and months preparing for one event. And what do we do? What about people who get up every day at 4am, in rain wind or sun, who get public transport to get across Guanabara Bay, full of pollution, to get to work, who do all of this to be able to eat? Isn’t that enough in itself?”.
These are the words of a member of SOS Emprego, one of the groups staging ongoing work stoppages in Rio, as the opening of the Games approaches.
In the Olympic city, as international media corporations and merchandisers prepare to cash in, many Rio workers’ salaries have been unpaid for several months. After declaring a state of financial calamity, the acting state governor allocated emergency funds to the completion of Olympics works and public transport, pledging to pay public sector workers who are among those awaiting payment of their salaries.
Workers on the city’s Metro are the latest group to begin strikes last week, threatening to walk out indefinitely. This follows strikes in recent months by rubbish collectors, bus drivers, metalworkers and healthcare workers. The state education system is paralysed, with the continuation of strikes at the state university, UERJ, and the school teachers’ strike now in its fourth month. In recent months there have been occupations at the Ministries of Culture and Health, and occupations by students in over 80 secondary schools.
A laboratory for development and extraction
For over a decade, the PT government in Brazil has treated Rio as a paradigmatic state for both urban development and resource extraction; a laboratory for schemes such as the installation of military police in favelas; and the development of Latin America’s most advanced technology for use in the deep-sea ‘pre-salt’ oil fields, 300 km off the coast. As athletes and tourists descend on the city looking for victories, these models are in crisis. The discovery of the ‘Pre-salt’, deep-sea oil reserves has spawned new petroleum cities around the capital and in the north of the state, and could place Brazil amongst the biggest producers of oil internationally. But the fall in global oil prices and poor policy responses by the government have, created a steep recession and left around 700,000 unemployed in Rio state alone, one of the biggest regional increases across the country.
Some of Rio’s workers have not been willing to accept these drastic reductions in their living standards. Among them are SOS Emprego, a group of unemployed workers from the construction and oil sectors. In early July the group marched from neighbouring city Duque de Caxias to the centre of Rio, where they joined other sectors in a march to the office of acting state governor Francisco Dornelles. In June Dornelles had declared a ‘state of financial emergency’ in the state, securing 2.9 billion reais in loans from the interim national government. The money was directed towards the completion of public transport works and security measures ahead of the Olympic Games.
Many members of SOS Emprego were previously employed at Comperj, a major oil refinery linked to Rio’s deep-sea oil reserves, built as part of the governing PT’s ‘Growth Acceleration Program’ (PAC). Launched by the Lula administration in 2007, with investment by Brazilian and multinational companies, PAC was a major infrastructure and investment program designed to enable energy production and mineral extraction on a greatly expanded scale. Urban programs and infrastructure, the PT believed, would transform trade relations throughout Brazil and regionally. The state became both major developer and business partner to multinational corporations. In Rio, the Comperj refinery was planned to be the biggest and most technologically advanced in Latin America.
The PAC program created a surge in formal employment in the construction sector, but at Comperj, one member of SOS Emprego estimates the subsequent plunge in the international price of crude oil has meant that of the original workforce of 30,000 only a few thousand are left. Major investors have deserted.
In Itaborai, the city which grew up overnight around Comperj, thousands of apartments, hotels, stores and high-rise buildings have been abandoned since last year and now lie empty. Real estate speculation in the area has all but collapsed.
A feast of outsourcing
The Lava Jato (Operation ‘Car Wash’) scandal exposed a world of illegal dealings between Petrobras and the construction businesses to which it frequently outsourced its operations. Much has been made of this proven decadence since the scandals emerged; much has also been done in the way of privatization, in the name of ‘reform’. Petrobras assets and subsidiaries have been sold, and a ban lifted on foreign companies operating in the ‘Pre-salt’ fields without the partnership of Petrobras. Brazil’s old Right has successfully channeled much of the anger which exploded in June 2013’s protests to a narrow focus on corruption, drumming up support for the impeachment of Dilma Rousseff – an ominous, institutional sleight-of-hand.
The formation of SOS Emprego prior to the crisis of the oil sector reflects both the complexities of resisting the advance of the Right, and the ways in which the PT’s policies opened the door to its own downfall: the outsourcing practices which increasingly fractured their working class support base, facilitated the illegal business practices revealed in Lava Jato and further entrenched the power of construction companies.
Outsourcing proliferated in Brazil during neoliberal structural reforms in the 1990s. It began in the petroleum and automobile industries, but was extended under the PT and is now common practice across public and private sectors. Industries which have surged under the PT, such as telecommunications, have done so on the back of a precarious workforce; from 2000 onwards flexible forms of work such as internships, online employment and self-employment have proliferated. In the construction industry, the elimination of formal employment in favour of subcontracting is a particularly strong trend. 2015 was the first time since the PT took power that the party has sought to escalate rather than pacify labour conflict, but the restructuring of production since 1990 has had a profound effect on the capacity of labour to organise in workplaces.
In 2014 alone around 360,000 Petrobras jobs were outsourced. The workers affected account for the vast majority of workplace accidents, work longer hours and receive around 25% less pay. But the process started much earlier: while Dilma Rousseff was a member of Petrobras’ Board of Directors (2003–2010), the number of outsourced workers more than doubled. SOS Emprego is entirely made up of this second-tier, outsourced workforce. The network of companies they worked for at Comperj were amongst the first to be implicated in Lava Jato. Soon after, some of these companies began to file for bankruptcy and work was paralysed.
‘A few months after the first rumblings of Lava Jato, the company we worked for suddenly changed name. We could feel something was going to happen, but they tried to reassure us nothing was going to happen. Then they fired over 400 of us on one day, and there were only 2500 left on our part of the site. Our next thought was, -let’s ensure these people you’re firing get the pay due to them. Then the problems began.’
In Rio de Janeiro, the construction industry alone accounts for around 30,000 of the unemployed. Months after the Lava Jato investigations were made public, hundreds from a handful of construction companies were laid off with no formal termination of the contract and no final salary payments. Companies simply vanished, leaving their employees without pay or housing, as accommodation is sometimes included in contracts. Petrobras remained mute. Abetted by the trade union which supposedly represented workers, companies attempted to make groups of workers sign forms giving dismissal dates later than the dates when they had in fact been laid off.
Now unemployed, SOS Emprego’s members returned to tactics and revived networks developed during a series of powerful strikes at the refinery in recent years. These strikes were some of the many in the construction sector since 2011, affecting various PAC, World Cup and Olympic sites. The Comperj conflicts also offer a glimpse of the contradictory relationship between official unions and the workers they represent. Sintramon, one of the unions active at Comperj, not only encouraged negotiation, but sided with the companies.
‘As our protests carried on [in 2015], the repression started. Armed people started showing up at the picket line, beating people up and saying if we didn’t get out, we’d be removed from there with bullets. One day some of us were running from the police, and we ran into some local people’s houses. The police started shooting at us in the houses. Some people there contacted journalists, and when journalists arrived they saw the workers from these businesses in conflict with the businesses and their union.’
Official unions and unofficial strikes
It’s not clear who was behind the threats, but the union’s constant role in quelling the strikes at Comperj was by no means untypical. Across PAC and other large construction sites, unofficial strikes have for several years occurred outside the control of the CUT and their affiliates. The PT created a government of union leaders, who took up thousands of strategic posts in government and Brazil’s pension funds which are some of the largest in the world. Funds, including Petros which belongs to Petrobras, were key investors in PAC and other mega-projects. With union leaders at the helm, a fundamental antagonism developed between their duty as trade unionists to represent workers and their role in government as business partners of large corporations and multinationals engaged in infrastructure and energy projects.
Both the CUT and the PT grew out of the ‘new unionism’ at the end of the military dictatorship, but have been transformed by the contradictions of rapid growth in the PT’s marriage of neoliberal politics and state-led capitalism. Mega-projects within and beyond PAC sustained the economic power of the construction sector, which translated into political power, as in other Brazilian eras: in recent elections, the party received more money from construction than any other sector.
Corruption investigations, of course, do not take place in isolation, and are easily manipulated by right-wing political agendas. In the case of the PT, the corruption scandals which are now being vociferously denounced by the Right were nourished by the outsourcing reforms from the 1990s onwards. It is not the illegal business practices per se, but the neoliberal politics with which they are linked which cause workplace accidents, low salaries and unemployment. Yet it is these effects, less spectacular and more routine, which are the lot of the working class who supported the PT for over a decade. As with the World Cup, the Olympic Games have provided a symbolic moment around which the contradictions of the PT’s policies appear ever more calamitous, and resistance to the Right, both old and new, a complex question with which workers such as those of SOS Emprego must struggle.Photos: Ali Sargent (except where separately credited)