ARGENTINA: Once Upon a Time, There Was a Middle Class

By Marcela Valente Reprint | | Print |

Marcela Valente

BUENOS AIRES, Jun 30 2004 (IPS) - In the 1980s, workers at Argentina’s former state oil monopoly YPF formed part of the country’s large middle class and could easily imagine their sons and daughters making it to the university.

Today, the workers left jobless by the privatisation of the oil company are a symbol of the massive, swift decline of the middle class, says the book ‘The Middle Class: Seduced and Abandoned’, which just came out in Argentina.

Written by Alberto Minujin, an expert in statistics with UNICEF, and journalist Eduardo Anguita, the book focuses on the descent of the middle class, the acceleration of the process since the December 2001 collapse of the economy, and the ”permanent” nature of the change.

Argentina’s vibrant middle class stood out in Latin America in the second half of the 20th century, as a broad, heterogeneous conglomeration of workers and professionals in both urban and rural areas who achieved high living standards through top quality public education.

But over the past 30 years, the middle section of the pyramid has slid down towards the base.

In an interview with IPS, Minujin said that among the most vulnerable are the unemployed who have seen their social and family ties deteriorate, and have begun to suffer a process of marginalisation.

”Even if the economy recovers, that sector will have serious problems reintegrating, because they have stopped looking for work, have disconnected, and are out of date,” he said.

He was talking about people who used to belong to the middle class but have gradually lost what gave them their identity as a social group: their jobs, education and health coverage, as well as the material assets they once enjoyed.

But the effects will be even worse for their children, Minujin predicted.

Many already have difficulties finishing high school and finding a job. And when they do find work, it is usually poorly-paid and precarious.

”As occurs in poor families, the disadvantages begin to build up, and affect people from the day they are born,” said Minujin, who is with the Policy and Planning Unit of the U.N. children’s fund (UNICEF).

Much of the middle class, which in the 1980s still represented nearly half of the population, began to slide into poverty in the early 1990s. It was an unprecedented phenomenon in this country which has traditionally been characterised by social mobility and social ascent.

The ”new poor” were middle-class families that maintained a certain level of education and assets, as well as coverage in terms of public services and utilities, but did not earn enough to stay above the poverty line.

Their children gradually began to feel the effects of an inverse social mobility, and the new category of the ”income poor” grew from 3.1 percent to 35.8 percent of people living in poverty, between 1980 and 2002.

In absolute terms, the members of the middle class who fell into poverty soared from 219,000 people in 1980 to 4.3 million in 2002.

Anguita said the phenomenon is well illustrated by former workers of YPF (now the Spanish-Argentine firm Repsol-YPF) oil company who began in the 1990s to hold protests by blocking key avenues and highways to draw attention to the negative effects of the privatisation of the company, especially in terms of employment.

”YPF provided workers with a route for social ascent. They could aspire to having an engineer son who would in turn join the company,” the journalist told IPS.

One of those interviewed by Anguita was a YPF employee in the oil field town of Cutral-Có, in the southern province of Neuquén.

”YPF brought the cinema here, created the local club, organised folk festivals and provided basic services,” recalled the former worker, who identified himself as Aurelio.

Today, Cutral-Có looks like a ghost town. Only 400 of the previous total of 4,000 employees were kept on by the local branch of the privatised company.

The wave of privatisations carried out by the administration of Carlos Menem (1989-1999) left tens of thousands of public workers unemployed, and with severance pay that did not last long, in a country that failed to generate enough real alternatives in the private sector to absorb the jobless.

Within just a few years, the ‘piquetero’ movement emerged – the name given to the unemployed protesters whose main tactic is staging roadblocks (piquetes).

The authors note that the growth of Argentina’s middle class, in the mid-20th century, was associated with a strong state that promoted industrialisation and development of the productive apparatus through public enterprises.

Employees of the powerful public sector earned high salaries and had free access to quality public schools, universities, research institutes and hospitals.

But the ”neo-liberal”, free-market reforms of the 1990s, which included spending cuts, privatisation and a ballooning of the foreign debt, led to a steep deterioration and changes in the social structure.

While in 1983 the richest segment of the pyramid earned 13 times more than the poor, in 2003 the income of the top segment was 50 times that of the bottom, according to the National Institute of Statistics and Censuses.

In the 21st century, the impoverishment of the middle class ”has gone beyond economic aspects.”

Those who used to form part of the middle class are also suffering a process of ”dis-education” and ”future poverty” – phenomena that compound their economic poverty, says the book.

Through interviews, it outlines personal histories that illustrate the social descent. ”The income-poor middle class, lacking prospects for improvement through education, is not only becoming culturally coarse, but fascist as well,” a phenomenon ”that is very disturbing for the political future of the country,” said Anguita.

The journalist, who has a degree in social communication, pointed to reduced respect for the law and diminished tolerance of differences.

Minujin, one of the authors of a study that gave visibility in the early 1990s to the phenomenon of the ”new poor”, said that in 1990 people in the impoverished middle class ”were ashamed” of having descended the social ladder and sought to ”conceal” their poverty.

But after the late 2001 crisis, the problem took on great magnitude and became highly visible in the massive protests that led to the resignation of President Fernando de la Rúa (1999-2001).

The hard-hit middle class was forced to seek social assistance, including government stipends for unemployed heads of households, equivalent to 50 dollars a month, whose recipients include college graduates and professionals.

In 1974, a mere eight percent of Argentines were poor. Today, the proportion is 48 percent, and includes many formerly middle-class families whose members are unemployed, retirees who draw meagre pensions, informal sector workers, and employees with low-paying jobs in the formal economy.

The authors estimate the cost of maintaining the living standards that middle-class youngsters enjoyed in the 1980s at 700 dollars per child.

That would include learning a second language and a musical instrument, practicing a sport, going to the cinema and theatre, having access to books, and being adequately dressed. ”And we haven’t even fed the child yet,” they point out.

That budget, which must be multiplied by the number of children and added to other expenses – food, housing, basic services, transportation – is far above the average income of an Argentine household.

According to the National Institute of Statistics and Censuses, more than half of income-earning Argentines take in no more than 230 dollars a month, less than what a family of four needs to stay above the poverty line of 244 dollars.

One of the greatest social losses is educational level. The authors introduce the concept of ”dis-education” to refer to the opposite of learning and acquiring knowledge.

Among those interviewed for the book is the current Education Minister Daniel Filmus, who considers himself a product of the traditional middle-class. Although his father was illiterate, he is a sociologist with several graduate degrees.

”We are seeing the first generation of youngsters who are worse off than their parents,” he pointed out.

The number of textbooks purchased plunged from 12 to two million between 1980 and 2002, because many families can no longer afford the cost of textbooks, and youngsters instead borrow them, go to the library, or photocopy only the sections they need. In addition, the middle class has lost its reading habit – a loss that Filmus says is associated with ”social pessimism.”

”In the popular imagination, education remains as important as it was before. But while in the past education was seen as a trampoline, today it is seen as a parachute. The bigger the parachute, the slower the descent, but the prospect remains one of a fall,” he added.

And ”the suffering” caused by that fall has left ”very severe wounds” in the health of the middle class, said Minujin.

Consultations for psychosomatic ailments, like ulcers, and psychological problems ranging from sleep disorders and hypochondria to severe depression, suicide attempts and psychotic episodes, have soared.

Members of the psychiatric emergencies team at the Alvear Hospital in Buenos Aires said that normally, 75 percent of calls are for ”typically psychiatric” consultations like psychosis. But since the crisis broke out, consultations ”for social pathologies” comprise a similar proportion.

”Sadness, dejection, depression, fatigue – the curve for these symptoms has risen exponentially,” Silvia Gross, coordinator of the domestic violence service at Alvear Hospital, told the researchers.

The impact of the descent of the middle class, say the authors, is comparable to what happened in eastern Europe after the collapse of the socialist bloc in the late 1980s and the incorporation of the region into the capitalist and free market economy, when the citizenry lost much of its coverage and protection from the state in the areas of education, health and employment.

Mortality rates rose and life expectancy fell in eastern Europe, which has seen epidemics of heart attacks, suicides and homicides, while the incidence of diseases that had previously been controlled, like diphtheria or tuberculosis, has climbed, the authors note.

But Minujin believes that the fall can be checked in Argentina, if income distribution improves, and that ”the middle class will re-emerge with strength.”

However, it will not have the same identity as the traditional middle class, he warned, nor will it be made up of the same people, because in 30 years many have fallen by the wayside.