Gas price hike, bus drivers strike

A transportation strike to protest fuel price increases that have raised gasoline to $2.34 a gallon and diesel to $1.58 took most of the buses off of Panama City streets and paralyzed public transportation in the Interior on May 24, but some of the bus syndicate leaders didn't back the strike, school bus, truck and taxi drivers declined to join in and many rank-and-file bus drivers ignored their leaders, whichever position they took. The bottom line is that, although the Free Trade and Consumer Affairs Commission (CLICAC) is suing the petroleum distributors for price fixing, the government isn't budging on its refusal to act against high fuel prices.

Panama's bus syndicates, to which the owner/operators of the buses must belong, are a mixed lot. A number of them are essentially little mafias, shakedown rackets run by unscrupulous characters who sell new bus permits even when their members have too few passengers to serve. Others are legitimate cooperatives looking out for the common good of their members. But since the members are all small business owners and mostly operating on such a tight margin that a day of lost work can make it difficult to make the payments on the loans they took out to buy their buses --- debts that are often owed to the syndicates themselves --- a strong sense of individualism usually impedes united political or economic action by this sector.

Because the bus drivers are both labor and management, and because most of the labor unions opposed the increase in city bus fares to a quarter two years ago --- some of them violently --- the Panamanian labor movement has not lent its support to the bus drivers' protest. However, on the day of the strike a noticeable minority of Panama City's work force stayed at home rather than put up with longer waits to get to and from their jobs.

As it turned out, the National Transportation Chamber (CANATRA) called the extendable one-day strike but Panama City's main city bus organization, the Collective Transportation Drivers' Syndicate (SICOTRAC) opposed the shutdown. But some drivers and syndicates that were expected to follow the CANATRA strike call worked anyway, while a number of SICOTRAC members ignored their leaders and kept their buses off the streets. In the capital at least half of the buses weren't running but many were, while elsewhere in the country the strike was more effective.

As this article was uploaded, CANATRA leaders had declared the strike indefinite, while the mainstream corporate media were calling the strike a failure. (Whether or not a labor action succeeds, publications such as La Prensa and El Panama America and the commercial television networks notoriously argue against it beforehand and report that it's a failure during and after the fact. In La Prensa's May 25 front page story the strike was characterized as a nearly complete failure, but in a separate inside story it was noted that the action virtually stopped activity at the national bus terminal at Albrook.)

The reasons for the rise in petroleum are worldwide and complex, but to look at it on the fundamental supply and demand level a major factor is that the ongoing Iraq War has cut supplies from that oil producing country and for a combination of reasons that include the Venezuelan government's need for more money to surmount a political crisis and Middle Eastern countries' reluctance to take measures that might bail George W. Bush out of economic difficulties in an election year, the big oil producing countries have not increased their production to make up the shortfall.

Arguments about supply and demand and geopolitics tend not to be very convincing for bus drivers who have fixed loan payments to meet and government-set fare schedules that prevent them from passing on cost increases to passengers. To many of these small business owners, higher fuel prices mean a decline from a lower middle-class way of life to the edge of poverty. Thus they are demanding either $2.6 million in subsidies --- which the government says it can't afford --- or price controls, which run counter to the free market ideology that prevails across most of the Panamanian political spectrum. Also on the CANATRA list of demands are a series of exemptions from environmental and safety regulations for gas stations, which the group believes would result in lower fuel prices.

Also in this section:
Business & Economy Briefs
Gas prices up, bus strike possible
Anatomy of a Scam, part 4

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Gas prices up with no relief in sight, bus drivers' strike only partially effective