OCTOBER 18 ITALIAN GENERAL STRIKE GENERATES

UNCLAS SECTION 01 OF 03 ROME 005131

SIPDIS

SENSITIVE

DEPT FOR EUR/WE AND DRL/IL
DOL FOR ILAB/BRUMFIELD

E.O. 12958: N/A
TAGS: ELAB ECON PGOV ECON PGOV ECON PGOV IT ITELAB ITELAB
SUBJECT: OCTOBER 18 ITALIAN GENERAL STRIKE GENERATES
WIDESPREAD DISRUPTION


UNCLASSIFIED

PAGE 02 ROME 05131 01 OF 03 220544Z
REF: A) ROME 5049 B)ROME 5083


1. NOT FOR INTERNET DISTRIBUTION.


2. (SBU) ILLUSTRATING BOTH ITS REACH AND DEPTH AS ITALY'S
LARGEST TRADE UNION CONFEDERATION, CGIL (THE GENERAL
CONFEDERATION OF ITALIAN WORKERS) BROUGHT MUCH OF ITALY TO A
CRAWL, IF NOT A COMPLETE HALT, DURING ITS ONE-DAY STRIKE
OCTOBER 18. THE EIGHT-HOUR ACTION CREATED SUBSTANTIAL
DISRUPTION THE LENGTH OF THE PENINSULA, ESPECIALLY IN THE
TRANSPORT SECTOR. IT ALSO GENERATED FURTHER ACRIMONY
BETWEEN CGIL AND THE OTHER TWO MAJOR CONFEDERATIONS, AS THEY
SPARRED OVER THE STRIKE'S IMPACT AND UTILITY, THAT WILL MAKE
THEIR RECONCILIATION MORE DIFFICULT. THE ONE-DAY STRIKE MAY
MARK THE END OF A PHASE IN WHICH THE THREE CONFEDERATIONS
HAVE SPENT MUCH OF THEIR ENERGY ARGUING AMONG THEMSELVES
OVER THEIR RELATIVE STRENGTH AND INFLUENCE RATHER THAN
PRESENTING A COMMON FRONT TO EMPLOYERS AND THE GOVERNMENT.
AT LEAST, THAT'S WHAT POLITICAL LEADERS ACROSS THE CENTER-
LEFT HOPE. CIRCUMSTANCES SHOULD HELP THE CONFEDERATIONS
PATCH THINGS UP: THE BUDGET CRUNCH AND A CRISIS AT FIAT AUTO
HAVE PROVIDED ORGANIZED LABOR, IN ALL ITS CONFIGURATIONS,
WITH A TANGIBLE THREAT TO ITS MEMBERS THAT IS WORTH FIGHTING
OVER.

TIMING IS EVERYTHING
--------------


3. (SBU) FOR CGIL, THE GAMBLE OF CALLING A STRIKE
INDEPENDENT OF THE OTHER CONFEDERATIONS (THE SECOND IN SIX
MONTHS AFTER ALMOST 40 YEARS OF JOINT STRIKES) APPEARS TO
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PAGE 03 ROME 05131 01 OF 03 220544Z
HAVE PAID OFF. BUT IT'S FAIR TO SAY THAT THE CONFEDERATION
WAS PERHAPS LUCKY RATHER THAN BRILLIANT. WHEN CGIL
ORIGINALLY CALLED THE STRIKE IN JUNE, ITS MOTIVE WAS LARGELY
TO OBJECT TO THE OTHER TWO (CISL AND UIL) CONFEDERATIONS'
DECISION TO SIGN A NEW LABOR PACT WITH THE GOVERNMENT AND
EMPLOYERS THAT INCLUDED THE BERLUSCONI GOVERNMENT'S PROPOSED
CHANGES TO ARTICLE 18 OF THE LABOR CODE (WHICH PROVIDE SMALL
EMPLOYERS MORE FLEXIBILITY TO FIRE WORKERS). ALTHOUGH
SYMBOLICALLY IMPORTANT, IT WAS HARDLY THE ISSUE THAT MANY
EXPECTED TO GALVANIZE PUBLIC OPINION OR PROMPT CHANGES IN
THE GOVERNMENT'S APPROACH TO LABOR ISSUES (GIVEN THAT FEW
EXPECTED A SURGE IN SMALL FIRMS' HIRING DUE TO THE ADDED
FLEXIBILITY).

4.(SBU) BUT A FUNNY THING HAPPENED ON THE WAY TO THE STRIKE:
TWO ISSUES WITH ENORMOUS PRACTICAL SIGNIFICANCE EMERGED.
FIRST, THE GOVERNMENT RELEASED ITS PROPOSED 2003 BUDGET (SEE
REFTELS FOR FULL ANALYSIS) TO WIDESPREAD OPPOSITION.
FINANCE MINISTER TREMONTI PROPOSED CUTS (DESIGNED TO KEEP
ITALY IN LINE WITH EU FISCAL CRITERIA) THAT INCLUDED
SUBSTANTIAL CONSTRAINTS ON PUBLIC FUNDS TO PROMOTE ECONOMIC
DEVELOPMENT AND INVESTMENT IN SOUTHERN ITALY (WHERE
UNEMPLOYMENT RUNS ABOVE 20%). AFTER INITIAL ANALYSES
REVEALED THE CUTS COULD JEOPARDIZE THE GOVERNMENT'S ABILITY
TO MEET ITS UNEMPLOYMENT BENEFITS AND TAX REDUCTION
COMMITMENTS UNDER THE NATIONAL LABOR PACT NEGOTIATED IN
JULY, CISL AND UIL WARNED THEY WOULD HEAD FOR THE STREETS IF
THERE WERE ANY REDUCTIONS IN AGREED MEASURES OR OTHER
ALTERATIONS TO OTHER ELEMENTS OF THE PACT.


5. (SBU) THEN FIAT ANNOUNCED PLANS (SEE SEPTEL) TO STABILIZE
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PAGE 04 ROME 05131 01 OF 03 220544Z
ITS AILING AUTO DIVISION WITH SHOCK THERAPY, PROPOSING PLANT
CLOSURES THAT WOULD IDLE OVER 8,000 WORKERS (INCLUDING
ALMOST 2,000 AT A PLANT IN WESTERN SICILY). IN A SOCIETY
WHERE LABOR MOBILITY IS THE EXCEPTION (AND SOUTHERN WORKERS
ESPECIALLY RESIST HEADING NORTH FOR WORK),THE PLANNED
CLOSURES FUELED A FIRESTORM OF PROTEST. WORKERS AT THE
SICILIAN PLANT BEGAN A SERIES OF WORK STOPPAGES AND SHUT
DOWN TRANSPORTATION ACROSS MUCH OF THE ISLAND, BLOCKING
FREEWAYS AND RAIL LINES. LOCAL OFFICIALS AND SICILIAN
PARLIAMENTARIANS JOINED UNION LEADERS IN DENOUNCING THE
PLANNED CUTS, CHARGING THE MOVE WOULD LEAVE DISMISSED
WORKERS AND THEIR NEIGHBORS LITTLE ECONOMIC ALTERNATIVE BUT
TO COLLABORATE WITH ORGANIZED CRIME. "DON'T LEAVE US WITH
THE MAFIA AT THE DOOR," PLEADED THE MAYOR OF ONE TOWN. CGIL
ASTUTELY SHIFTED THE MOTIVES FOR ITS STRIKE, DECLARING THAT
THE ACTION WAS INTENDED TO DEMONSTRATE MORE BROADLY THE
CONFEDERATION'S OPPOSITION TO THE BERLUSCONI GOVERNMENT'S
ECONOMIC POLICY.


6. (U) THE STRIKE PROMPTED WIDESPREAD DISRUPTION ACROSS
ITALY, AS THE CONFEDERATION STAGGERED ITS ACTIONS ACROSS THE
VARIOUS TRANSPORT SECTORS TO CREATE MAXIMUM DISRUPTION.
ALITALIA WAS FORCED TO CANCEL 275 FLIGHTS (50% OF ITS DAILY
SCHEDULE) AND NATIONAL RAIL CARRIER TRENITALIA DROPPED 40%
OF ITS MEDIUM AND LONG-HAUL ROUTES FOR THE DAY. UNION
MEMBERS IN L'ACQUILA (WHERE CLOSURE OF ANOTHER FIAT PLANT

UNCLASSIFIED

UNCLASSIFIED PTQ0875

PAGE 01 ROME 05131 02 OF 03 220544Z
ACTION EUR-00

INFO LOG-00 NP-00 AGRE-00 AID-00 CEA-01 CIAE-00 COME-00
CTME-00 DODE-00 ITCE-00 DOTE-00 ANHR-00 SRPP-00 DS-00
EB-00 EXME-00 E-00 FAAE-00 UTED-00 VC-00 FRB-00
H-01 TEDE-00 INR-00 IO-00 ITC-01 LAB-01 L-00
VCE-00 AC-01 NSAE-00 NSCE-00 OMB-01 OPIC-01 PA-00
PM-00 PRS-00 ACE-00 P-00 SCT-00 SP-00 IRM-00
SSO-00 STR-00 TEST-00 TRSE-00 USIE-00 PMB-00 DSCC-00
PRM-00 DRL-02 G-00 SAS-00 /009W
-------------- FC0389 220545Z /38
R 220459Z OCT 02
FM AMEMBASSY ROME
TO SECSTATE WASHDC 6449
INFO DEPT OF LABOR WASHDC
EUROPEAN POLITICAL COLLECTIVE

UNCLAS SECTION 02 OF 03 ROME 005131

SIPDIS

SENSITIVE

DEPT FOR EUR/WE AND DRL/IL
DOL FOR ILAB/BRUMFIELD

E.O. 12958: N/A
TAGS: ELAB ECON PGOV ECON PGOV ECON PGOV IT ITELAB ITELAB
SUBJECT: OCTOBER 18 ITALIAN GENERAL STRIKE GENERATES
WIDESPREAD DISRUPTION

UNCLASSIFIED

PAGE 02 ROME 05131 02 OF 03 220544Z
COULD IDLE 1,400) BLOCKED THE PRINCIPAL HIGHWAY CONNECTING
ROME WITH THE ADRIATIC COAST. MASS TRANSIT STOPPAGES AND
UNION PROCESSIONS IN 120 CITIES CREATED WIDESPREAD
DISTURBANCES IN URBAN CENTERS. IN ROME, AN IMPROMPTU
OCTOBER 17 PROTEST BY 2,000 WORKERS AND FAMILY MEMBERS FROM
THE THREATENED SICILIAN PLANT (BUSSED IN THE NIGHT BEFORE)
GREW TENSE WHEN POLICE PREVENTED THE PROCESSION FROM
REACHING THE PRIME MINISTER'S OFFICE.

DUELING STATISTICS
--------------


7. (U) UNION LEADERS FANNED OUT ACROSS ITALY TO RALLY THE
FAITHFUL AND SPEAK AT THE DEMONSTRATIONS. FORMER CGIL
LEADER SERGIO COFFERATI, OSTENSIBLY THE MOST POPULAR FIGURE
WITHIN ITALY'S FRACTURED, CONTENTIOUS CENTER-LEFT
OPPOSITION, MARCHED WITH HIS PIRELLI COLLEAGUES (AND 250,000
OTHERS, ACCORDING TO CGIL) THROUGH MILAN JUST DAYS AFTER
REJOINING HIS EMPLOYER FOLLOWING A 20-PLUS YEAR UNION
CAREER. HIS SUCCESSOR, GUGLIELMO EPIFANI, LED 200,000 OF
THE FAITHFUL IN TURIN (HEADQUARTERS OF FIAT'S FAR-FLUNG
HOLDINGS, INCLUDING FIAT AUTO). RALLIES IN ROME AND NAPLES
DREW UPWARDS OF 150,000 AND 130,000, RESPECTIVELY, INCLUDING
MANY STUDENTS. (NOTE: ATTENDANCE ESTIMATES REPORTED BY
CGIL; INDPENDENT ESTIMATES HAVE NOT YET BEEN REPORTED BUT
COULD BE LOWER). JOINING THE PROCESSIONS WERE MOST OF THE
OPPOSITION CENTER-LEFT PARTIES' LEADERS; SOME WITH
CONVICTION (IN THE CASE OF COMMUNIST RENEWAL LEADER
BERTINOTTI),OTHERS WITH A DEGREE OF PUZZLEMENT (IN THE CASE
OF DEMOCRATIC LEFT LEADER PIERO FASSINO AND FORMER PM
UNCLASSIFIED

PAGE 03 ROME 05131 02 OF 03 220544Z
MASSIMO D'ALEMA). FASSINO URGED THE THREE CONFEDERATIONS TO
REDEVELOP A UNIFIED POSITION, SUGGESTING THE OPPOSITION
(ALREADY FRACTURED) COULD ILL-AFFORD DIVISIONS WITHIN ONE OF
ITS KEY CONSTITUENCIES.


8. (U) THE STRIKE WAS A ROUSING SUCCESS, EPIFANI DECLARED;
CGIL HAD "BROUGHT MILLIONS INTO THE STREETS" TO PROTEST THE
GOVERNMENT'S ECONOMIC POLICIES. THE CONFEDERATION ALSO
CITED HIGH PARTICIPATION IN SEVERAL SECTORS, INCLUDING OVER
50% OF TEACHERS. PARTICIPATION WAS ESPECIALLY HIGH IN THE
HEAVILY-INDUSTRIALIZED (AND UNIONIZED) NORTHWEST, WITH 60-70
PERCENT REPORTED AT FIAT AUTO. IN CONTRAST, CISL AND UIL
DOWNPLAYED THE STRIKE'S SIGNIFICANCE, CLAIMING NO MORE THAN
A THIRD OF THE WORK FORCE PARTICIPATED AND SUGGESTING THERE
HAD BEEN LITTLE CROSSOVER SUPPORT TO CGIL FROM THEIR
MEMBERS. LABOR MINISTER MARONI CHARACTERIZED THE STRIKE AS
"MODEST," AND EXPRESSED THE GOVERNMENT'S HOPE THAT THERE
COULD NOW BE A BROADER DIALOGUE AMONG ALL THREE PARTNERS -
LABOR, EMPLOYERS AND GOVERNMENT.

NOW WHAT?
--------------


9. (SBU) MANY OBSERVERS BELIEVE THAT, HAVING MADE ITS POINT,
CGIL WILL ONCE AGAIN FIND COMMON CAUSE WITH THE OTHER TWO
CONFEDERATIONS. IN THE WEEKS PRECEDING THE STRIKE, EPIFANI
BEGAN HINTING AS MUCH, AVOIDING ANY SUGGESTION THE
CONFEDERATION WOULD SET CISL AND UIL'S RENUNCIATION OF THE
SUMMER'S LABOR PACT AS THE PRICE OF RENEWED COOPERATION.
SEVERAL OBSERVERS POINT TO EPIFANI'S MORE MEASURED REMARKS -
IN CONTRAST TO THOSE OF HIS COLORFUL PREDECESSOR, COFFERATI,
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PAGE 04 ROME 05131 02 OF 03 220544Z
UNDER WHOSE LEADERSHIP CGIL CALLED THE STRIKE - AS EVIDENCE
THAT HE IS PREPARED TO MOVE ON. BUT THE LEADERS OF THE
OTHER TWO CONFEDERATIONS BOTH SIGNALED THAT ANY
RECONCILIATION WOULD DEPEND ON CGIL'S WILLINGNESS TO MOVE IN
THEIR DIRECTION. UIL LEADER ANGELETTI DECLARED THE STRIKE
"USELESS; IT DIDN'T SOLVE ANYTHING," AND CISL LEADER LUIGI
PEZZOTTA SAID HE WAS "FED UP" WITH CGIL CRITICISM OF THE
NATIONAL LABOR PACT SIGNED IN JULY. ANY DISCUSSION OF A
FORMAL UNITED FRONT - SOMETHING CISL HAD BEEN ASKING
COFFERATI AND CGIL TO DISCUSS FOR 18 MONTHS - WOULD BEGIN ON
THE BASIS OF THE LABOR PACT, PEZZOTTA DECLARED.


10. (SBU) BEHIND THE RHETORIC, THOUGH, THERE ARE SIGNS THE
THREE CONFEDERATIONS ARE IDENTIFYING COMMON GROUND.
METALWORKERS FROM THE CONSTITUENT UNIONS OF THE THREE
CONFEDERATIONS ARE DISCUSSING A COMMON STRATEGY AND TACTICS
TO TACKLE FIAT AUTO'S RESTRUCTURING PLANS AND REPORTEDLY ARE
CONTEMPLATING A SECTORWIDE STRIKE IN THE NEXT FEW WEEKS.
THIS TECHNICAL-LEVEL COLLABORATION MAY LEAD TO BROADER
DISCUSSIONS BY CONFEDERATION LEADERSHIP OF A SHARED
FRAMEWORK. FROM OUR PERSPECTIVE AT LEAST, THAT SHOULDN'T
PROVE TOO HARD; BETWEEN THE PROPOSED BUDGET AND THE FIAT
AUTO CRISIS, THERE'S PLENTY ON WHICH THE THREE
CONFEDERATIONS SHOULD BE ABLE TO AGREE. A UNITED FRONT
WOULD CREATE A SMOOTHER NEGOTIATING PROCESS (THOUGH PERHAPS
A MORE EXPENSIVE PRICE TAG) FOR THE BERLUSCONI GOVERNMENT AS

UNCLASSIFIED

UNCLASSIFIED PTQ0876

PAGE 01 ROME 05131 03 OF 03 220544Z
ACTION EUR-00

INFO LOG-00 NP-00 AGRE-00 AID-00 CEA-01 CIAE-00 COME-00
CTME-00 DODE-00 ITCE-00 DOTE-00 ANHR-00 SRPP-00 DS-00
EB-00 EXME-00 E-00 FAAE-00 UTED-00 VC-00 FRB-00
H-01 TEDE-00 INR-00 ITC-01 LAB-01 L-00 VCE-00
AC-01 NSAE-00 NSCE-00 OMB-01 OPIC-01 PA-00 PM-00
PRS-00 ACE-00 P-00 SCT-00 SP-00 IRM-00 SSO-00
STR-00 TEST-00 TRSE-00 USIE-00 PMB-00 DSCC-00 PRM-00
DRL-02 G-00 SAS-00 /009W
-------------- FC038C 220545Z /38
R 220459Z OCT 02
FM AMEMBASSY ROME
TO SECSTATE WASHDC 6450
INFO DEPT OF LABOR WASHDC
EUROPEAN POLITICAL COLLECTIVE

UNCLAS SECTION 03 OF 03 ROME 005131

SIPDIS

SENSITIVE

DEPT FOR EUR/WE AND DRL/IL
DOL FOR ILAB/BRUMFIELD

E.O. 12958: N/A
TAGS: ELAB ECON PGOV ECON PGOV ECON PGOV IT ITELAB ITELAB
SUBJECT: OCTOBER 18 ITALIAN GENERAL STRIKE GENERATES
WIDESPREAD DISRUPTION

UNCLASSIFIED

PAGE 02 ROME 05131 03 OF 03 220544Z
IT TRIES TO TAME SOME OF ITALY'S STRUCTURAL ECONOMIC
PROBLEMS WHILE PRESERVING SOME MEASURE OF INTRA-REGIONAL
HARMONY AND, IN THE FORM OF FIAT, ONE OF THE SYMBOLS OF
ITALY'S POSTWAR ECONOMIC TRANSFORMATION FROM CRIPPLED
AGRARIAN NATION TO MODERN G-7 MEMBER. CLOSER COOPERATION
AMONG THE UNIONS, WHILE FAR FROM SUFFICIENT TO BREATHE NEW
LIFE INTO ITALY'S CENTER-LEFT, WOULD NONETHELESS BE A BOON
TO THE FRACTURED OPPOSITION, AS THE DIVIDE BETWEEN UNIONS
MIRRORS AND EXACERBATES PROBLEMS WITHIN THE DEMOCRATS OF THE
LEFT AND AMONG OLIVE TREE "COALITION" PARTIES.

UNCLASSIFIED

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2002ROME05131 - Classification: UNCLASSIFIED