At around 11 PM the night of Oct. 10, Mexican soldiers and federal police agents occupied facilities of the government-owned Central Light and Power Company (LFC) in Mexico City and several central Mexican states, reportedly using force to remove workers on the night shift. About an hour later Mexican president Felipe Calderón Hinojosa's center-right administration published a decree liquidating the company and terminating some 41,000 active employees. The decree promised respect for the workers' labor rights: the government said it would guarantee severance pay and pensions, at an estimated cost of some $20 billion pesos ($1.512 billion).

The independent Mexican Electrical Workers Union (SME), which represents about 43,000 active workers and 23,000 retirees, had warned in late September that the government might attempt to seize the facilities. But the military and police operation on a Saturday night seemed to take SME leaders by surprise. The leaders had met with President Calderón's private secretary, Luis Felipe Bravo Mena, on Oct. 8 and were expecting a response from the president on Oct. 12.

The SME leadership moved quickly to mobilize supporters. Thousands of unionists gathered in front of the SME headquarters on Insurgentes Avenue in Mexico City on Oct. 11 as union general secretary Martín Esparza Flores announced that the SME would challenge the government decree in Mexican courts on constitutional grounds and would also appeal to the Inter-American Commission on Human Rights (IACHR, CIDH in Spanish) and the International Labor Organization (ILO). He advised laid-off employees not to sign up for the severance pay--which might be used to indicate they had accepted their terminations—but instead to file individual challenges to the layoffs.

Esparza Flores denied that the union would try to sabotage operations of the LFC, which provides power to the Federal District (DF, Mexico City), and México, Morelos, Puebla and Hidalgo states, but he called for mobilizations. The union announced a major march on Oct. 15 from the Angel of Independence to the Zócalo, the capital's giant central plaza.

The government claimed the LFC's liquidation was necessary because the company was wasteful and inefficient. According to the government, expenses per unit of power were at least 176% higher than for the Federal Electrical Commission (CFE), the other government-owned company; the CFE provides power to the rest of the country and was expected to take over the LFC's operations. Business leaders were quick to support the government's actions. "Every company has two roads: either you're efficient or you die," Miguel Marón Manzur, president the National Chamber of the Manufacturing Industry (Canacintra), said on Oct. 11.

But former Mexico City mayor Andrés Manuel López Obrador—a center-left leader who officially lost the national presidency to Calderón in 2006 in a narrow race—rejected the government's claims and announced his support for the SME. López Obrador is countering Calderón's austerity measures with his own legislative proposals, which he says would save about 200 billion pesos ($15.12 billion) by taxing the rich and cutting government waste and salaries for high officials. Union supporters have charged that the LFC liquidation is the first step in a plan by Calderón and the business associations to privatize the entire state-owned power system.

Calderón also has a political goal, according to Dan La Botz, editor of Mexican Labor News and Analysis. "[T]he government wants to eliminate [a union] which has been the leading force in organizing to oppose the Calderón government's economic policies," La Botz wrote on Oct. 11. As of Oct. 5 the government had suspended recognition of the union's current leadership, citing what it said were irregularities in the SME's July election, in which Esparza barely edged out challenger Alejandro Muñoz Reséndiz by a 27,010-26,658 vote.

"This is a turning point," La Botz wrote on Oct. 11. "The Mexican government's attack on the Mexican Electrical Workers Union—a union central to resisting government policies and building labor and social movement coalitions, and located in Mexico City, which is the center of political opposition to the government—may well turn out to be a watershed event in the country's recent history." He noted that solidarity activists can protest the government's actions by writing to President Calderón at felipe.calderon@presidencia.gob.mx with a copy to the SME at sinmexel@sme.org.mx. (La Jornada, El Universal, Mexico; MRZine, Oct. 11; Wall Street Journal, Oct. 6)

From Weekly News Update on the Americas, Oct. 11

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