Mendoza, Argentina: Economic change through academic, professional and political exchange

Article written by Charles Hanks, collaborator of the social economy in higher education project,  following a visit to the “Institute of Work and Production” of  the National University of Cuyo, Mendoza, Argentina.

“As a public university,” asserts José Perlino, “we have a very important social role.” Indeed, José and his colleagues in the Institute of Work and Production (ITP) at the National University of Cuyo (UNCuyo), find themselves the axis of a growing social and solidarity economy in the Mendoza province of Argentina. In their efforts to make visible the workings of the third sector by drawing together its academic, professional and political elements, they are also managing to make the sector more credible.

From the cooperative to the classroom: a two-way exchange

It is the linking of these three aspects that is the innovation and success of their work. ITP is pushing for more representation of social economic practices on courses at the university and in 2009 ran a course in Social Economy for which there was a very high take up and a great deal of enthusiasm among students. Alongside this, Roberto Roitman, general secretary of ITP and Economics professor at the university, runs a social economy module each year as part of the general Economics undergraduate course; despite his working here for several decades, Roberto is still seen as something of a ‘black sheep’ in a department he bemoans having a mainstream approach to the discipline. As part of this teaching unit, he invites people who work in the sector to talk to students, giving them practical insight and a link to the tangible impact of what they are studying. José tells me that when they open the doors to these people, the reaction from the students is very positive; many come to them afterwards asking about internships in the sector, which ITP is well-placed to organise. “This contact makes them realise that they take part in the social economy themselves, and it is not on a small scale, not the poor working for the poor.” Universities can be very elitist, he replies, when I comment on how much he and his colleagues seem to value the link between the academic and the ‘live’. “Organisations are not made in the university; they are made in the street, learning from their mistakes.”

And the link works both ways. The Institute runs training courses and workshops open to all that eventually allow people with much experience in the sector but no relevant qualifications to obtain accreditation from the university recognising and ‘rubber-stamping’ their knowledge and experience. These training sessions also help towards what José describes as one of the key aims of his programme: capacity-building. “We work mostly on organising supply, grouping entrepreneurs together, increasing the scale and improving the quality, providing certification. And basically ensuring they have the means of providing to the state, which makes up a huge part of all purchases.”

Completing the triangle: political backing

Indeed, the state is now obliged to make at least 10% of its purchases from social enterprises, thanks to the Social and Solidarity Economy Law passed in Mendoza in 2012. In 2009, the ITP helped to form the first Mendoza Social Economy Forum which brought together organisations from the sector from across the region. Five years on, the Forum has taken place seven times and is making tangible steps towards a greater representation of the social and solidarity economy. The 2012 Forum welcomed 160 organisations and was held in conjunction with the second

‘Towards an Alternative Economy’ forum attracting interested parties from all over the country, including representatives from the national government. As well as holding workshops and talks, the Forum also provided an opportunity to discuss the introduction of a provincial law that would give official backing to the growth of the sector – hence the political aspect of their work. The law was passed shortly afterwards and a council was set up to ensure its implementation. This panel is made up of seven members: three from organisations within the sector (representing cooperatives, microcredit unions and familial agriculture respectively); three from the provincial government (one each from the social development, agroindustry and schools departments); and one academic, a position currently held by Professor Roitman. José explains that a principal role of the council is to “work with government members in charge of buying to make sure they know the law and their obligation, and also that they know why it is important to work with the social economy, because the cultural change is very slow.” This observation extends to the general public, it seems: “If we all bought 10% of what we buy from social enterprises it would be a huge change,” he suggests.

The crash: before and after

Argentina has, however, already seen huge economic change in recent years. In 2001, the country suffered a debilitating crisis following a series of reckless borrowing agreements with the IMF and, especially after the mass privatisation of the 1990s, the population was left in a dismally insecure situation: 27% were unemployed and half were living below the poverty line. In response, thousands of workers left without jobs, in hundreds of businesses across the country that had been forced to close, joined together to take co-ownership of their workplaces – most of them factories in various manufacturing industries – in a vast cooperative movement known as fábricas recuperadas, which succeeded and continues to grow today despite initial obstacles from government and previous owners. Others took a different initiative; a distinction arose, Roberto explains, between the words ‘work’ and ‘job’ (both ‘trabajo’ in Spanish): a ‘job’ is a kind of work no longer available to all, so people had to create their own ‘work’. Whereas before the crisis there were three million microentrepreneurs among an economically active population of 16 million, these now numbered five million, the extra two million mostly women forced into starting small businesses to support their families. In addition, the value of the peso plummeted (it still has not recovered, standing at around one-tenth of its pre-crash worth) and a widespread bartering market grew up around the country.

All of this was indicative of the three key aspects, according to Roberto, of what is a relatively thriving social economy in Argentina. The first, he says, originates with indigenous traditions, notably that of minga, which translates roughly from Quechua as ‘reciprocity and solidarity’. Around 10% of the population of Mendoza is of indigenous Bolivian origin (the proportion is much higher further north) and he suggests that they have long influenced local economic attitudes, especially to farming. He cites the influx of Europeans towards the end of the 19th century as a second influence, bringing with them the newfangled cooperativism; the first mutual in Argentina was established by Italians in Buenos Aires and the first cooperative by Jewish immigrants in the Entre Ríos province 1890. Thirdly, and most urgently, the 2001 crisis affected economic attitudes, perhaps irreversibly. “Cooperativism helped overcome previous challenges,” says Professor Roitman. “But now there are new challenges and we need new solutions. People have begun to realise that capital is at the service of economics and economics is at the service of people.”

The ‘prosumers’: challenging the norm

One such person was Pablo Ordoñez. Before the crisis, he had owned two businesses and was director of a youth centre for 13 years. He describes the crash as a ‘calling’: the economic collapse alongside his vocation for social work called for something new. “The Argentine economy at the time of the crisis was a long way from being social,” he says. “It was something not even the President or the Finance minister had any say over.”

So, nine years ago, he founded El Arca, which he describes as a ‘socially managed business’ though in a limited legal paradigm it is simply a ‘non-profit organisation’. The aim of the organisation is to join together producers and consumers, who are often the same people, he points out: small producers for whom the crisis and the rocketing inflation that came with it were disastrous, principally those working in textiles and food, but also in services and in crafts; and consumers from families to local businesses to large companies. So, I try to clarify, his team of around ten working at El Arca is a kind of intermediary between the producer and the consumer? “Definitely not.” He is firm on this point. Rather, they are working to bridge the gap between producer and consumer, as producers and consumers themselves, to create a solidarity network of producers and consumers – ‘prosumers’ he calls them. He is not one to be satisfied with limiting or dichotomous denominations, apparently. “We wanted to establish ourselves outside the norm, somewhere that joined together the educational, the social and the typically economic.”

The educational aspect, he explains, involves providing “permanent learning spaces, not just for producers but also for consumers. The idea is to work on the concept of the conscious consumer, fair trade, responsible production – hence this community of ‘prosumers’.” All sorts of people have gotten involved, he says. “People who already have a good understanding of these ideas, as well as people who are recently discovering the power they have in the instant of producing or buying a product, and the advantages that breaking with the model of producer and consumer as two separate worlds can have.” This all-inclusive ethos extends to the private sector, too; El Arca has, for example, a contract with Arcor, one of Argentina’s largest food corporations, to provide clothing to wear in their factories.

Linking to the future

The aim is for “the greatest possible intersectorial link”, says Pablo, as much in his role as President of the Social Economy Forum as that of El Arca’s President. This link also embraces, of course, the public sector. He is lukewarm about the new law, describing it as a “valid tool but not perfect”. He does, however, highlight an important distinction from ostensibly similar laws elsewhere in the country: others have been developed by the government and passed onto the ‘prosumer’; this one has been developed from the bottom up and is being implemented accordingly, with producers, consumers and academics all being given a voice, and one the government seems keen to listen to. José explains to me how they are starting to convert these broad links into practical benefits. The stipulated government 10% will come in part from graphics and other smaller purchases, but they aspire to more. “Our idea is to organise buying for school canteens, as well as hospitals and health centres. Also within textiles, for all the sports teams in the province for example. These are just two areas into which the government puts a lot of money but at the moment it all goes to a few businesses.” Another job of the council is to create a register of social enterprises in the province and, from there, a catalogue which will be available not only to relevant government departments but also the general public, allowing producers greater visibility and consumers greater awareness – the empowerment of the ‘prosumer’.

And at the ITP, determined to keep juggling as many balls of social enterprise opportunity as possible, they are looking to improve provision within the university. Much of the food in the canteens is already sourced from social enterprises, and now they are trying to create microcredit opportunities for student entrepreneurship, as well as extend their training programmes. “And we buy a bag of vegetables here in the ITP once a week,” José adds, proving his money is where his mouth is, quite literally.

Towards an alter(n)ative economy

“There is talk of moving towards an ‘alternative’ economy,” Roberto muses. “But perhaps more accurately what we are aiming for is an ‘alterative’ economy.” The difference is subtle but important, and indicative of what ITP and the Social Economy Forum support: what is needed is not just a change of economic ideas but economic ideas capable of bringing social change. It is an active, inclusive, socially empowering outlook. “When we buy from social enterprises, we’re buying something else,” José asserts, speaking on behalf of an ever-wider community. “We’re paying for jobs, for people to stay in their homes, for a product that has value in its origins. We arrive at the source. We remove the middle man.”