When 2,000 workers at a textile plant near the city of Zagreb went on strike one day last year, authorities of this Communist-ruled country were quick to respond.
Top officials from the factory, the local government, the trade union confederation and even the Croatian parliament rushed to the scene. Within two hours, the rebels were promised changes in the factory's management, a new development plan and raises of up to 25 percent.
That pampering quickly ended the strike and allowed government officials to head off a potentially serious confrontation. Yet both the rank-and-file defiance and the high cost of quenching it added to a much more troubling challenge: for all over Yugoslavia, labor unions, factory councils and government managers are scrambling to halt similar stoppages.
Fed by four years of economic hard times, strikes organized spontaneously by workers have grown from the status of political oddities under Yugoslavia's unorthodox Communist system to a serious social and economic problem. The number of reported stoppages has quadrupled since 1982, involving more than 25,000 workers in the first half of 1985.
Although the strikes' immediate causes range from declining wages to stringent work rules and unpopular managers, they have two underlying themes: a repudiation of the socialist institutions that nominally make strikes unnecessary and increasing resistance to Yugoslavia's efforts to restructure its chaotic economy.
"There is a global conflict going on in society, and the first reason for it is the difficult economic situation," said Milan Jovicic, a leader of the official Trade Union Confederation of Yugoslavia. "The crisis has brought threats to the rights of working organizations. Workers are losing their incomes and are reaching the limit of sacrifices."
The compromises popular discontent is forcing on federal economic authorities are increasingly apparent. Since 1981, Yugoslavia has struggled with a foreign debt of almost $20 billion through reforms and austerity measures that have prompted declining living standards. More than 1 million people, or about 15 percent of the working population, are now officially reported jobless, while price increases have reached an annual rate of nearly 80 percent.
Guided by the International Monetary Fund and its western creditors, the relatively weak central government overseeing Yugoslavia's six autonomous republics has managed to increase foreign exports and achieve a net surplus of hard-currency earnings for debt payments for three consecutive years.
Many economists and diplomats here, however, say that the authorities have made little progress in implementing measures that could halt inflation and return the country to long-term stability. "The stabilization program is not being applied, because to apply it would mean to disturb too many vested interests," said Ljubisa Adamovich, an economist at the University of Belgrade. "It is a tough medicine that we just can't digest right now."
One example of the policy breakdowns emerged in recent weeks as government officials risked IMF censure by failing to raise domestic interest rates, a key measure of the stabilization plan. Interest rates far below the rate of inflation have fueled financial speculation and propped up inefficient businesses, and IMF and Yugoslav experts agreed they must gradually be raised to above inflation.
Yet, under intense pressure from heavily indebted industries facing the prospect of bankruptcy, government officials left the benchmark interest rate at 61 percent in January -- well below inflation -- and raised it to 68 percent this month only under intense pressure from the IMF and western creditors.
Interest rates are only the beginning of the economic obstacles the stabilization program has failed to budge. Yugoslavia has also been unable to unify the economies of its various republics, with the result that many industries are plagued by overcapacity as neighboring regions compete with one another.
The strikes are one sign that the country's uniquely decentralized socialist institutions are withering under the pressure of the crisis. Much of the opposition to federal policies among workers and other interests is based on the perception that federal officials have increasingly adopted centralized administrative measures that evoke the command-style economics of Soviet Bloc countries.
Nonaligned Yugoslavia abandoned such policies 20 years ago in favor of a system of "self-management" that -- in theory, at least -- relies on capitalist-style market competition and gives workers' councils control over state enterprises and their operation. But while Soviet Bloc nations such as Hungary and Poland have recently embraced parts of the self-management system, "self-management in Yugoslavia has stagnated in the last few years," Jovicic said.
"There is a conflict between self-management and state-controlled development," he added. "The work stoppages point to the fact that trade unions and self-management organizations do not perform their job well."
Official Yugoslav labor leaders, who uniformly oppose all work stoppages, are quick to point out that few, if any, of the strikes are explicitly directed against the political system. They acknowledge, however, that each strike spontaneously organized by workers is a vote of no confidence in both organized unions and the self-management system, under which workers should have no reason to rebel against a management they nominally control.
This implicitly defiant character of strikes and their dependence on grass roots leadership outside recognized institutions explain why authorities are often so quick to grant workers' demands. As in the case of the textile factory in Croatia, nine out of 10 stoppages are quickly settled when workers are granted pay increases and other demands, union officials said.
"Our work stoppages are the most effective in the world," said Jovicic with a grin. "Because in the majority of cases, the people who participate in them are working within the system. The strike is meant to get self-management functioning again."