Link to this page: http://www.socialistparty.org.uk/issue/329/5578
Parmalat Workers Shafted By Capitalist Greed
WORKERS AT the main production base in Italy of "Europe's Enron" have no sympathy for those they call the "magnificent eight" locked up in Milan's notorious San Vittore prison. They are the founder and Chief Executive, Calisto Tanzi, and five directors of the Italian food giant Parmalat and two directors of their accounting firm, Grant Thornton who have brought the company to bankruptcy and the verge of collapse.
As the hunt widens to uncover the network of fraud behind the disappearance of $8 billion into a "black hole", the jobs of more than 36,000 workers in 139 workplaces worldwide are under threat. The missing billions are equivalent to nearly 1% of Italy's GDP!
The company has grown in 40 years from a small family-run delicatessen in the northern city of Parma to the eighth-largest company in Italy and a 'flagship' of Italian capitalism. It now operates in 30 countries packaging and selling milk, water, fruit juice, biscuits and other foods and has made rapid inroads into the Latin American and East European markets.
Parma is also at the centre of Italy's 'red belt' with a long history of militant workers' struggle. A shop steward of the union federation Cisl, Angelo Peracchi, explained after a shop-floor council meeting on New Year's Eve, that the workforce is determined to fight. "There are whole families working here... many fear they have lost their life savings because the company and the local banks encouraged them to invest in Parmalat bonds... The workforce here is very heavily unionised".
The workers and their organisations should campaign around the demand for immediate nationalisation (without compensation) of Parmalat and a programme of industrial action on an international as well as a local plane.
The workers of Italy are still involved in numerous strikes, and a generalised offensive against the government is needed. The economy is in trouble even without the Parmalat crisis and wages are not keeping pace with inflation. Six million Italian pay packets are below the minimum subsistence level.
The budget deficit is Û12 billion worse than last year and only kept within the 3% of GDP deficit range by the sale of state assets and 'one-off' measures which cannot be repeated. The government of Silvio Berlusconi itself is threatening to collapse as the coalition partners fall out. The Parmalat crisis could be the last straw.
His government has taken Parmalat into administration and appointed Enrico Bondi, "a turn-around expert", to replace the imprisoned executives. It has organised a cash injection of Û50 million and given a six month deadline for recovery.
As a member of Lotta per il socialismo (the Socialist Party's counterpart in Italy) in nearby Modena commented, it is not just a question of regulation and control, as the economics minister, Tremonti, claims. "Instead it is capitalism itself which is to blame because it is a system based on the laws of profit and not the needs of people like the Parmalat workers, the striking underpaid transport workers, the Alitalia hostesses fighting for a better deal in life."
The Securities and Exchange Commission in New York calls the Parmalat affair, "One of the largest and most brazen corporate financial frauds in history."
There have been other dramatic collapses recently elsewhere in Europe (Vivendi in France and Ahold in the Netherlands). In Italy, Fiat has come close to collapse. Parmalat is eleven times smaller than Enron, but, as scores of investigators continue their work and the net widens, La Repubblica (5/1/04) comments that "The work developing on the Parma-Milan-New York axis risks touching the very heart of the international finance system".
For the workers of Parmalat and the associated industries, in Italy and worldwide, the only solution is a struggle to oust the bosses from their 'enterprises' and from society as a whole.
In The Socialist 10 January 2004:
Socialist Party feature
Socialist Party Marxist analysis
Socialist Party workplace news