A Tale of Free Trade and Labor and Money and Power in Mexico By JOHN M. McCLINTOCK

March 01, 1992

MATAMOROS, MEXICO — Matamoros, Mexico. -- The 286-pound Mexican Big Daddy spits on the floor, oblivious to the little girls who snatch lollipops from a plastic bucket underneath his desk.

Agapito Gonzalez is both magnanimous and callously rude, a big-bellied throwback to Faulkner and Tennessee Williams.

At 77, Agapito sits at the pinnacle of power, defying his president and America's major corporations.

He is, in the words of an American executive, "The biggest son of a bitch I ever met."

And yet, within a few days, he will be broken across the knee of forces far larger than himself, with names like General Motors and Zenith.

His is the story of big power in Mexico, of big money and the "modernization" of the Mexican labor movement.

This is the story of Agapito Gonzalez, a union leader who had won some of the highest wages in Mexico and who was opposed to a free trade agreement with the U.S. and Canada.

Last week President Bush and Mexican President Carlos Salinas de Gortari met in San Antonio to praise the free trade agreement, saying it would benefit Mexican workers.

There was not a peep out of Agapito Gonzalez.

/# He was a prisoner of the state.

"Atomic Ant"

In Mexico City, 700 miles from this sleazy border town, sits a

diminutive man so energetic that he is called the "Atomic Ant."

The bald, 43-year man has a different perspective than Agapito Gonzalez, who quit the third grade to work in the cotton mills in Matamoros.

When Agapito was doing labor organizing in American businesses in Matamoros, "the Atomic Ant" was filling out an application for Harvard.

The world of "the Atomic Ant" was that of the Mexican political elite, of good schools that led to powerful jobs controlled by the Institutional Revolutionary Party (PRI).

The one thing Agapito and the "Atomic Ant" had in common was that they were part of the PRI's ruling coalition of labor, farm workers and government employees.

The "Atomic Ant" wanted to modernize Mexico and open its borders to investors through a free trade agreement.

But Agapito was opposed, fearing a free trade agreement would lead to the domination of Mexico by American companies and the loss of union gains embodied in the Mexican Constitution and its labor laws.

Above all else, he believed the agreement would lead to the exploitation of Mexican workers and to the gutting of tough union contracts such as his own.

By the time of his downfall, Agapito was the most powerful man in Matamoros, the head of a union that represented 35,000 workers in 77 companies, most of them American.

Agapito was proud of his accomplishments. He had the won a 40-hour work week and the highest industrial wages on the border, if not the country.

But to the employers, Agapito's power was so great that they felt he infringed on their rights as managers and that he was a pompous man who wouldn't listen to reason.

Specifically, they wanted to submit contract disputes to binding arbitration, rather than be forced to endure Agapito's perennial strikes.

Under the modern manufacturing system the plants kept small inventories and thus could not endure work stoppages of any length. Every year there were Agapito's quick strikes followed by companies settling for 20 to 25 percent increases.

And so, beginning in 1988, they started a campaign to get rid of Agapito, eventually going directly to the "Atomic Ant" in Mexico City.

The "Atomic Ant" was none other than the president of Mexico, Carlos Salinas de Gortari.

Fighting the Unions

When Mr. Salinas took office in 1989, Mexico was being strangled by unions that had become too powerful and in many cases too corrupt.

The powerful oil workers' union had made impossible the running of Pemex, the state petroleum company. Workers inherited "positions" that allowed them to receive salaries, even though they never worked a day for the company.

Longshore unions had made a nightmare of the ports, requiring kickbacks that ran into the millions of dollars.

If Mexico was to become a modern country suitable for investors, it could no longer countenance union featherbedding and corruption.

Within three years of taking office, Mr. Salinas had tamed or broken the unions representing the oil workers, teachers, longshoremen, brewerymen and autoworkers.

The administration also made it clear it would not tolerate strikes that hindered labor modernization.

A 1990 strike at the Ford Motor Company's plant near Mexico City was broken by goons from the Confederation of Mexican Labor (CTM). The confederation is Mexico's equivalent of the AFL-CIO except that it is part of the PRI's ruling coalition that has kept it in power for 63 years.

Another strike at a Mexico City brewery was similarly broken -- this time with the aid of the police.

Maquiladoras

The situation on the U.S. border was different.

The border industries grew out of the government's need to find jobs for a million Mexicans who illegally sought work in the U.S. every year.

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