Greedy capitalists threaten ship

Martin Mayer, Unite Executive Council member for Passenger Transport and chair of the International Transport Workers Federation (ITF) Road Transport Section sent the Socialist his report of a dramatic stand-off in Ghana between a US ‘vulture fund’ and the Argentine government.

The dispute is over bonds that were defaulted on eleven years ago during the major financial crisis in Argentina.

The Argentine naval vessel ARA Libertad was seized because Argentina refuses to pay a $20 million bond that the vulture fund demanded, as part-payment on that country’s junk bonds, to release the ship.

The ITF trade union group has condemned the seizure.

The vulture fund, Elliott Management Corp, (led by financier Paul Singer) is majority shareholder (22%) in UK passenger transport multinational National Express (NEX).

Elliott is seen as a prime mover in NEX’s union-busting stance in its US yellow school bus operations.

ITF affiliate US International Brotherhood of Teamsters (IBT) is battling for union rights for the NEX subsidiary’s school bus employees in a joint campaign with UK union Unite.

Elliott’s subsidiary NML Capital Ltd tracked the Libertad to the port of Tema in Ghana where it then got an injunction to hold the vessel until a payment of around $20 million is made.

Elliott seeks repayment in full of $172 million of Argentine debt bought in 2001 for 15-30 cents on the dollar.

Elliott’s NML subsidiary claims to hold Argentine bonds with a face value of $630 million which they now say are worth $2.3 billion with accrued interest.

Argentina defaulted on $82 billion in dollar-denominated debt and devalued its currency in 2002.

Talks with investors began in 2005, when the then Argentine president, Nestor Kirchner, offered 30 cents on the dollar to buy back the bonds, agreed by 93% of Argentina’s creditors.

The Ghanaian court ruling is in nobody’s interest except Paul Singer’s and his multi-billion vulture fund operation.

It cannot be right that an independent capitalist institution can undermine international debt restructuring efforts with impunity – and at massive profit to itself. Argentina claims that seizure of their vessel is illegal in maritime law.

The international trade union movement is siding with the Argentinean people and their unions. The ITF is calling for solidarity messages: [email protected]

Vultures with links to the top

The ITF often has to rescue distressed seafarers left stranded around the world, sometimes owed months of wages by wealthy ship-owners.

It has major battles with multinational capital which fires trade union activists in other countries.

A current ITF campaign involves multinational giant DHL whose subsidiary sacked 20 union activists in Turkey.

Elliott Management Corp is no friend of trade unions and working people – or of poor countries crippled by debt in our global capitalist system.

Elliott donated millions of dollars to US Republican causes, making a substantial donation to Romney’s presidential campaign.

It funded a US lobby for lower top rates of tax and for regulations favouring hedge funds like Elliott, including the right to claim payment in full – with interest – on defaulted foreign government bonds.


Such business made Elliott one of the most profitable global capitalist institutions, with average annual returns of a staggering 14%.

Buying up defaulted government bonds of the world’s poorest countries and reclaiming their value in full – with interest! – is one of Elliott’s most lucrative activities.

Elliott also bought junk bonds (mostly at 20% of their face value) from Delphi Automotive, US auto components firm, which filed for bankruptcy in 2005.

In 2009, Singer’s hedge fund group won control of Delphi and refused to either make up the $7 billion shortfall in the pension fund or pay any more US workers’ pensions.


In 2009, no US government bailout of GM or Chrysler could have worked without saving Delphi, which received more than $12.9 billion in taxpayer-backed loans. Delphi then employed 25,000 union workers.

The original US bailout plan would have saved 14 US plants but the hedge funders demanded double the price the Treasury would pay for their “junk” bonds.

Elliott’s profits from that bailout are estimated at $1.28 billion, yet not one US union production worker now remains.

Out of 29 US plants only four remain employing 5,000 workers, as production shifted to China where 100,000 workers are employed to make those same automotive components.

Mitt Romney’s wife Ann invested “more than $1 million” with Elliott via her blind trust – so their smallest possible gain was $10 million.