• March 24th, 2019
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The battle for Venezuela (Part I)



Herbert Jauch

Venezuela has been in the headlines for several weeks and most of the western and global mass media paint a picture of a dictatorial government oppressing its people.  Outside interventions, including economic and financial sanctions and the threat of military interventions are portrayed as the only way to “liberate Venezuela.  This narrative is misleading and false and thus this background paper aims to sketch some of the events that led to the standoff between the Venezuelan government and imperial interests.

When Venezuela’s former President Hugo Chavez Frias passed away on 5 March 2013, he left behind a country that had experienced huge socio-economic and political achievements during his 14-year presidency.  At the time when Chavez won the presidential elections in late 1998, Venezuela had had several decades of regular political elections but the voters’ choice was largely between two parties that shared the same ideological believes. Venezuela was characterised by severe apartheid-style social divisions between the affluent elite on the one hand and the impoverished working class on the other.  Whoever ruled was largely unaccountable to the electorate, appointed its supporters into the judiciary and dominated the trade unions as well as civil society organisations.  

Before Chavez, the country’s oil revenue was essentially used for elite self-enrichment and to pay for a network of patronage.  Venezuela’s economic policies were free-market oriented but this model collapsed in February 1998 when the then government announced that it had to submit to International Monetary Fund (IMF) dictates, abolishing food and fuel subsidies, cutting spending on health and education.  The resulting hardships affected the poor the worst and resulted in widespread riots.  Upon coming to power, the Chavez government promised to change the political, economic and social landscape through a programme of redistribution and social justice.  

Initial reforms
One of the first steps taken was to embark on a series of far-reaching reforms regarding social service provision, for example, access to housing, education and health care.  The resources needed for these social programmes were derived from the country’s oil resources.  The national oil company, several large manufacturing companies and much of Venezuela’s farmland already belonged to the state by the time the Chavez government was elected but what changed was how these resources were utilised to benefit the poor.  The royalty fees payable by private oil companies and an extraction tax was introduced to pay for the extensive, health, housing and education programmes, locally known as “missions”.  Their success became visible in the form of freely accessible health care, education form literacy classes to tertiary level, vastly broadened for students from poor families, community housing initiatives, community food kitchens etc.  Poverty declined dramatically and Venezuela raised minimum wages to the highest level in Latin America in the Chavez era.  These minimum wages were also paid to those engaged in “house work” in recognition of their contribution to society.

According to the UNDP, Venezuela’s Human Development Index increased from 0,69 in 1998 to 0,88 in 2007 while the rate of poverty fell dramatically.  Thus there can be no doubt that Venezuela managed to significantly improve standards of living of the poor during the Chavez presidency.

Grassroots democracy
In political terms, the emergence of grassroots structures of direct political participation were probably the key achievement.  Despite the vast powers vested in the presidency, Chavez was well aware that the move towards what he termed the new “socialism of the 21st century” could only be successful if it was rooted in grassroots democracy.  Various initiatives were taken such as the “Bolivarian Circles” before the communal councils were established from 2006 onwards.  These councils are neighbourhood organisations comprising of 200 – 400 families in urban areas and at least 20 families in rural areas.  In the Chavez era, over 70% of Venezuelans were organised in over 30 000 community councils which take decisions in “citizens’ assemblies” attended by residents who are 15 years and older.  These assemblies elect their council executive committee, financial management and monitoring committees as well as thematic committees dealing with particular local priorities such as health, education, land, recreation etc.  The councils are a practical learning experiment for the poor who had virtually no experience with participatory democracy before.  The councils can receive funds directly from the national, state or city governments or through fundraising and donations.  This is facilitated through communal banks, which the councils set up as co-operatives.  

Despite some tensions between the “formal” political structures like city councils, mayors and governors and the community councils, Chavez regarded the councils as the most important structure to effect fundamental changes.  He realised that they facilitate a process of people regaining control over their lives and are an alternative rather than an appendix to the old and often corrupt local government institutions.  Chavez regarded community councils and banks as the seeds for Venezuela’s new socialism and pointed out the need to learn the lessons from the mistakes made by socialist states in the previous century.

Responding to pressure “from below”
The initially moderate economic programme of the Chavez government started changing in 2005 when Chavez had survived the failed US-sponsored coup attempt and began to exert some control over the corrupt state administration and oil revenues.  Also, the encouragement of social movements began to show visible results. The Chavez government was responsive to pressure “from below”.  Former workers at a paper mill that had been declared bankrupt and closed by its owners decided to occupy the mill and re-opened it with the support of the local community.  Venezuela’s parliamentarians then passed a law allowing for the expropriation of the mill and to let it operate under democratic workers management.  Since then, workers started seizing other companies that had closed down.  A worker and community-led movement for the “recovery” of companies was born and over 800 companies are run by workers themselves, producing for local needs.  In addition, some private companies in strategic economic sectors like oil and cement production were nationalised.

The process of change in Venezuela was and still is at times contradictory and there were concerns that Venezuela’s “Bolivarian revolution” was too dependent on the personality of Chavez and that the community councils were too dependent on funding from the presidency.  Critics within Chavez’ own United Socialist Party pointed out that an emerging layer of bureaucrats showed little commitment to the ideals of the revolution and may use political positions of power for personal gain.  Chavez himself was very aware of these dangers and regarded participatory democratic structures of mass participation at various levels (such as community councils and banks; worker-run factories; community health centres etc.) as the best defence for the achievements made.  He admitted that the old bourgeois state was still alive and kicking and that his government was facing a major challenge “to convert the old counterrevolutionary state into a revolutionary state”.

Building Latin American Unity 
At international level, Chavez’ most significant contribution was the building of Latin American unity to counter the US dominance.  He recognised the importance of emancipation from the policy descriptions of the US, World Bank and IMF and thus was the driving force behind several continental initiatives. These included the Union of South American Nations (UNASUR) which is an intergovernmental union integrating two existing customs unions known as MERCOSUR and the Andean Community of Nations.  The UNASUR Constitutive Treaty was signed in 2008 in Brazil and came into force in 2011.  It takes South American integration a step further with a common parliament envisaged in Bolivia and the Bank of the South (as an alternative to the IMF and World Bank) in Venezuela.

Another key initiative to curb the imperial influence of the USA was the formation of the Community of Latin American and Caribbean States (CELA) in 2011 in Venezuela’s capital Caracas.  The “Declaration of Caracas” was signed by 33 countries representing over 600 million people and was a clear sign of deeper integration and a determination to reduce US influence.  CELA is a concrete alternative to the Organisation of American States (OAS) which is under strong US influence.

Perhaps the most important initiative driven by Chavez was the “Bolivarian Alternative for the Americas” (ALBA) as alternative forms of co-operation.  ALBA is an attempt to implement “fair trade” (as opposed to “free trade”) where each country provides what it is best placed to produce and receives what it needs most - independent of global market prices.  Thus Bolivia can provide gas at discounted prices to its neighbours; Venezuela can offer subsidised oil to poorer countries and shares its expertise in developing oil reserves; Cuba can send health-care professionals and train students from other countries at its medical schools. Unlike the free trade agreements, ALBA proposes that the elimination of poverty and marginalisation takes centre stage, including human, labour and gender rights. 
(to be continued…)


New Era Reporter
2019-03-01 10:10:56 22 days ago

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