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Chile fights itself, wins, then loses

Ok, straight from the 'can't make this shit up' department we have these bullet points:

1) In 2007, Chile gov't tells Codelco (it's own wholly owned, nationalized, works-for-the-people copper company) to take around 5,000 sub-contracted workers and make them fully fledged employees (thus paying them more, giving them better benefits, pension plans etc)

2) Codelco (wholly owned by Chile, the gov't and its citizens etc etc) takes its gov't to court to fight the plan. It doesn't want to hire Chilean people to do Chilean jobs at Chilean mines to benefit the Chielan gov't. It wants to pay these people a flat rate way below the employees' salaries.

3) Codelco wins 7 out of the 8 cases and appeals the lost case.

4) The non-contracted workers now threaten strike action and halt production at Chile's own copper mines.

This is not small beer for the world market either, as Chile supplies around a third of all the copper in the whole wide world and Codelco is the world's biggest single copper company and about 30% of all Chile's copper comes from them (according to 2007 figures). News of the proposed strike action got to the market this morning and pushed copper spot to U$3.92/lb.

WHAT KIND OF KAFKAWORLD IS THIS? Codelco, run by Chileans for Chileans doesn't want to employ Chileans on a full roster basis. Of course it's going to add to costs, but what's the big difference between;

a) giving extra money to Chileans and less money to the Chilean gov't to spend on the Chileans, and
b) giving less money to Chileans and more to the Chilean gov't who would then spend it on....errrr...the

Go on, have a wild guess as to which group of nationals will suffer most if this strike comes to pass.* Which government will lose revenues? Which company will lose revenues for that matter. And remember, Chile is by general outside consensus the best run country in Latin America. Makes you wonder what these analysts are smoking, really......

Got PCU? Good, cos PCU not got Chile.

*Hint: country mentioned in title