“There is no alternative”. The proud proclamation of neoliberalism had long been repudiated in theory by Marxists and in slogans (“another world is possible”) by myriad forces assembled in the WSF. But the man and woman on the street needed a practical demonstration that it was really possible, even in a pre-revolutionary society, to defy American dictates and diverge from the prescribed neoliberal model towards a relatively pro-people, democratic trajectory of development. Venezuela under Hugo Chavez Frias is important because it provides the world with such a demonstration -- far from perfect, naturally, but very exciting to be sure.

Chavez began to tread this path in short steps right from the start of his career as President. This invited the US- aided, “opposition”-sponsored coup of April 2002. “After the defeat of the coup”, writes Alan Woods, leader of a Trotskyist trend in Venezuela, “it would have been possible to carry out a socialist revolution swiftly and painlessly. Unfortunately, the opportunity was lost...” (“The Venezuelan Revolution” (2006)). But it appears that the President had a better sense of the actual balance of forces and preferred to consolidate his position before going on to the offensive. (One may recall that when in 1992 the military revolt he led against the hated ruling clique failed and he was arrested, Chavez appealed to his supporters to surrender “for now”; he chose a prison term for two years rather than “fighting to the finish”.)

Offensive against Neoliberalism and Imperialist Domination

The new, higher stage of confrontation began right after the President was re-elected in the December 2006 election with a record 63 per cent vote, the highest in the history of Venezuela. By this time the economy also had recovered from the shock it had received during the “bosses’ lockout” and was in good shape. Thanks to the oil price boom, it was growing at around 10% per year.

First, the President announced a far-reaching nationalisation programme. “Everything that was privatised will be nationalised,’’ he stated. The nominally state-owned Petróleos de Venezuela (PDVSA), (with subsidiaries like the distributor CITGO) which had long been working as an autonomous body often in defiance of government policies had already been brought under control after the subversive lockout in late 2002. But some other sectors of the huge industry remained in the hands of the oil oligarchy and now they have been brought under state control. Moreover, the Chavez government has imposed high taxes and controls on big industries, nationalised some of them (for instance, the telephone company CANTV) and threatened others -- including powerful foreign banks -- with nationalisation in the event of failure to serve the national economy as desired by the government.

Second, cutting the counterrevolutionary electronic media down to size. On May 27 this year, the broadcasting concession granted to Radio Caracas Television, which played a direct role in instigating and organising the illegal April 2002 coup against the elected government, expired. It was not renewed and the private channel was converted into a public service channel. This is not only a strong blow to the media hegemony of the arch- reactionary Venezuelan opposition; it is also a bold attack on the media arm of international reaction. This is complemented by the launching of Telesur, an all Latin American television channel. It broadcasts from Caracas to millions of people throughout the continent and beyond, and thus effectively combats the control over the airwaves that Washington seeks to exercise through the CNN.

Third, Venezuela has dissociated itself from the IMF and World Bank, viewed as something ‘impossible’ by protagonists and apologists of neoliberalism. It may be recalled that right on 12 April 2002, almost simultaneously with the coup, the IMF had publicly stated that the Fund was “ready to assist the new administration [of Pedro Carmona].” This was an unprecedented announcement from the IMF, for the Fund is typically cautious about determining whether a new government is eligible for its lending, even when it is an elected government. In this case, it determined almost instantly that the coup government would be a suitable partner. It is obvious that the Bush administration, which had foreknowledge of the coup, influenced the IMF’s behaviour.

Fourth, bringing back the welfare state, considered a taboo in neoliberal economics. Right from the start President Chávez has been pushing through a wide range of welfare measures on health and education, food subsidies and homes for the poor and so on. The state also introduced a modest land reform programme, to be discussed later in this article. Now there is a proposal for reducing the labour day to six hours and 36 or 34 hours a week, depending on whether it is a day or night job.

Fifth, Latin American and Third World solidarity. Chávez had earlier reversed Venezuela’s longstanding US-induced policy of undercutting OPEC quotas, in this way helping to reverse the trend towards low oil prices and restore pricing clout to oil producing nations. This was a big blow to petrodollar imperialism of America and a boost to oil nationalism and OPEC solidarity. Now the withdrawal from the IMF and the World Bank is accompanied by a plan to launch a “Bank of the South” in cooperation with other Latin American countries -- an ambitious step towards financial independence of the South.

Venezuela has co-sponsored with Cuba the Bolivarian alternative for the Americas (ALBA), which is steadily gaining ground against the failed US-sponsored free trade area of the Americas (FTAA). It has also joined the Southern Cone’s Common Market (MERCOSUR) which had comprised Brazil, Chile, Argentina and Uruguay, as an associate member. In early August this year, 9 Caribbean and Central American countries (Grenada, Belize, Cuba, Dominica, Haiti, Nicaragua, San Vicente & Grenadines, Jamaica, Surinam and Venezuela) signed the Treaty of Energy Security (TSE) aimed at starting a process of energy integration under the auspices of Venezuela’s Petrocaribe. Incidentally, Petrocaribe allows countries to pay part of their oil bills in goods and services; for example, Cuba repays about half of the subsidized oil it receives from Venezuela by sending medical professionals to serve in poor neighbourhoods in Venezuela.

It has been pointed out that all these and the whole gamut of social welfare programmes have been made possible by favourable market conditions (especially the surge in petro-prices) which are not likely to last for ever. But surely that does not negate the political significance of what is happening here. In earlier periods and in other countries enhanced oil incomes have been squandered away by the ruling elites and gobbled up by Western MNCs; this time around they are being put to far better use. More important, the masses are tasting change, they are confident and on the move, and even if the government backtracks in a different situation, the struggle will go on and intensify.

Class Struggle and the State

The best way to understand the dynamics of socio-political change in Venezuela and to judge the class character of the Chávez regime is to examine the role of the state vis-à-vis the developing contours of class struggle on the ground.

Land question and cooperatives

As in India, over 75 percent of farmland in Venezuela is controlled by fewer than 5 percent of landowners. Under a 2001 land law, the government can tax or seize unused farm sites. The Venezuelan authorities have identified more than 500 farms, including 56 large estates, as idle. Some of these large estates have been expropriated, and nearly 1 lakh families have been resettled.

Unlike in India, more than 80% of Venezuelans live in towns and cities. This is a product of a rural to urban migration that followed the industrializing efforts of the oil boom of the early twentieth century. Now with financial and technical support from the state, the landless and the unemployed are being encouraged to re-populate the countryside and cultivate fallow land. But the problem is, the supposed owners of such land refuse to recognise that it belongs to the state. This has led to killings of campesinos, and to popular resistance. The people are organizing themselves with the assistance of cooperatives, communal councils, left activists, NGOs and others.

The struggling peasants often have to go against local bureaucrats and at times also confront the central authorities. Thus on 12 July 2005, the Frente Campesino Ezequiel Zamora led a 6,000-strong march of peasants in Caracas. A special commission was created by the government and some steps taken.

In a peasant conference organised in the capital in early February 2005 by the same organisation, there was universal support for President Hugo Chavez, but the Agrarian Reform Law was severely attacked. For it allows only lands over 5000 hectares to be expropriated and these lands need to be uncultivated to be covered by the law. The peasants criticised the Agrarian Reform Institute, which they claimed was so slow and bureaucratic that, as they put it, owners of latifundios would cut down whole forests off the land while the Agrarian Reform Institute made up its mind.

The conference discussed the need for armed self-defence as well as the possibility of guerrilla warfare if there is a U.S. invasion. They defended the need to build collective farms rather than dividing up the land. The peasants discussed blocking the Panamerican Highway to get their demands. The only discordant note was from the local Mayor who told the peasants to have more patience and that the law was like a ‘father who makes rules for his child’. Her proposal for patience was solidly rejected.

Workers control and ‘co-management’

Over the past few years more than 1000 factories have been taken over and occupied by workers after being shut down. In 2005 Chavez proclaimed a series of decrees to allow for expropriation of industry and workers co-management in the interest of public utility. But the recovered factories, despite having the support of the government, are in essence faced with the same problems of the recovered factories elsewhere: how to survive in a sea of capitalist economic relations, how to ensure supply of raw materials, how to ensure a buyer for the finished product, and so on. We reproduce below excerpts from a report by a delegation from the International Miranda Centre which visited Inveval (a valve manufacturing company that has been under workers’ control since April 2005) in July this year.

Inveval is legally constituted as a cooperative with 51% owned by the state and 49% owned by the workers. Union representatives claim that real power lies with the workers assembly. Rather than supervisors, the workers elect, through a workers assembly, recallable ‘coordinators of production,’ for a period of one year. And everyone gets paid exactly the same.

Finding raw materials and buyers are the most pressing problems. Although the workers at Inveval could source raw materials from other countries such as Mexico, Argentina, or China, endogenous development regulations require them to prioritize sourcing raw materials from within Venezuela and as yet they have not been able to find a source.

Therefore, the main area of work at Inveval involves the repair and maintenance of existing valves for PDVSA, with the company running at only 10% capacity, and surviving from government loans, a situation which is obviously unsustainable.

Additionally, the workers were having difficulties with PDVSA with whom they are contracted to supply valves. The workers started production using remaining raw materials to fill previously existing contractual obligations with PDVSA. But as yet PDVSA has not complied with its side of the deal and the finished valves have been sitting on the factory floor for the past eight months.

The workers at Inveval told us that during a meeting between Chavez, Inveval, and Veneval, (the body responsible for contracting valve supply in PDVSA) in April, the President of Veneval claimed that Inveval did not produce any valves. The President of Inveval said that was “rubbish” and that they had valves ready to supply PDVSA. Chavez then ordered the president of Veneval to visit Inveval to see if there were valves. After that PDVSA agreed to take the valves but did not pick up the existing ones. On the contrary, PDVSA has started to order such valves as they know Inveval is currently unable to manufacture. On this ground they are now claiming again that Inveval is unable to fill the orders.

The workers contend that corrupt sectors in PDVSA would rather deal with private companies, where they can make deals and make money. A union leader said, “The bidding process for PDVSA allows for corruption. They should get rid of the bidding process and just get valves from us because we are a state company and they are a state company.”

“There are definitely sectors of PDVSA that are opposed to workers’ control and to the example of Inveval,” he added.

Despite these difficulties the workers at Inveval are keeping themselves busy, as well as carrying out community projects such as working with the local mental asylum. The factory premises provide space for various social welfare programmes, and the communal councils also use the factory as a meeting place. All of the workers also participate in two hours of technical and socio-political classes each day.

Inveval also regularly hosts political forums, visits from student groups, international delegations and delegations of workers from other occupied factories.

In 2006 the workers at Inveval initiated FRETECO (The Revolutionary Workers Front of Co-managed and Occupied Factories) and held a national congress in October with representatives from 10 factories to discuss and debate their experiences, challenges and strategies. More recently, FRETECO held a meeting on 30 June with representatives of 20 factories to discuss a unified proposal of statutes for implementing workers control.

From experience such as this, workers learn that simply having industry state-owned does not mean it will automatically be run in a socialist way. The corrupt bureaucracy the present government inherited from previous regimes is alive and kicking and true workers’ control will remain a far cry until more radical measures are taken throughout the country.

The winds of change, particularly the enhanced activism of workers and peasants, are opening up new vistas of class struggle. This has also led to sharpened struggle between contradictory tendencies within the present order. We shall come back to this point, but before that let us take a glance at the more important changes currently taking place in the political system.

Political Reform

On January 10, 2007, after being sworn in for his second presidential term, Chavez proposed a number of reforms. An important one has been called “Revolutionary Explosion of Communal Power”. It aims to promote communal councils -- local neighbourhood organizations of 200 – 400 families -- throughout the country. 26,000 communal councils exist now, and the number is expected to be doubled The formation of the councils is seen as a process through which a sense of community spirit can be formed, and humans can develop themselves while taking care of municipal and local developmental activities. But it is not very clear exactly what scope these councils will have.

Generally speaking, such devolution of power is a good thing. And given the otherwise positive atmosphere of popular activism in Venezuela, the councils seem to have a good potential for promoting participatory democracy. On the other hand, our own experience with panchayats shows that in the absence of revolutionary change in social (class, caste, gender, etc) relations, decentralisation means little more than reproducing existing structures of dominance and broadening the social base of the ruling elites. So we have to wait and see.

The President has also asked for an Enabling Law, which would allow him to enact laws in specific areas directly rather than taking these through the National Assembly. Now, this is nothing new in Venezuela. His predecessors had taken recourse to this, and Chavez himself used it to push through as many as 49 pro-people legislations in 2001. But that was when he did not have adequate support in the Assembly. At present there is hardly an opposition in that the body (because the opposition had boycotted the last elections) to delay matters, so this leaning towards centralisation of powers has raised some genuine doubts, especially when considered in conjunction with the ongoing drive for dissolving all parties which supported the Chavez government into one great party.

Towards Single Party Rule?

The formation of the new Unified Socialist Party of Venezuela (PSUV), which the Venezuelan President calls “a tool to guarantee the collective direction and continuity of the [Bolivarian] Revolution,” is well underway. The party has received overwhelming support from the people, with 5.7 million registering to join in a country of 25 million where 7 million voted for Chavez in December last year. However, there are some reports of overstating enrolment figures and other irregularities.

The new party will unite all Chavistas (Chavez supporters) under one banner in order to combat party sectarianism, infighting, and corruption. Thirteen of these parties, including the bigger ones such as Chávez’s own Fifth Republic Movement (MVR), have agreed to the incorporation and therefore dissolved themselves. Others, such as the Communist Party of Venezuela (PCV), the social democratic We Can (PODEMOS), and Fatherland for All (PPT), asked for more time to debate the proposal.

Referring to this, Chavez said in Caracas on March 19, 2007: “If they want to leave, they may do so. They are not indispensable.” “For me, they are almost in the opposition,” he added.

Chávez also called the governor of Sucre, Ramón Martínez of PODEMOS, a “counterrevolutionary” and a “coward”. He called on the people of that state to exercise their right to recall against such governors. He said, “I don’t accept your support. ... I don’t consider you with us, I consider you against us!”

“Either you are with us or you are against us”... one just cannot avoid recalling these words of Chavez’s hated adversary, even when one does not wish to.

The leaders of the left parties, however, reacted with restraint. Said PCV General Secretary Oscar Figuera, “The comrades of the PCV I know will never follow the opposition … You will never see the Communist Party in the opposition. You will always see them accompanying the leader of the process: President Hugo Chavez Frías.” He also said that the PCV might support the formation of the PSUV by being involved in the discussions leading up to the formation of the new party without dissolving the PCV. That way they would be able to contribute their ideas while still waiting to see the outcome before making a final decision to dissolve the party.

The PCV, which supported Chavez from the very beginning of his career, and which has eight elected members in the present national assembly including one minister, thus faces a very complex situation. Some leaders and members have decided to join the new party, others have not.

Now Chavez is perfectly within his rights to consolidate the huge groundswell of popular support in his favour in the form of a unified party. Maybe he also needs it to sideline other influential leaders within his own old party who do not see eye to eye with him. But the demand of immediate dissolution of all the friendly parties and immediate merger -- without any prior discussion among the parties of the ruling coalition on the programme of the proposed party -- seems problematic. We are afraid the process is fraught with dangers of monopolisation of power and denial of political democracy.

Of course, it is not possible for us to arrive at a final judgement at this stage and from this distance. The character of the PSUV will be determined over the next few months in the congress period. It will depend on its class composition, its leadership and its programme. There will now be an open struggle between reformists and revolutionaries, between bureaucrats and rank and file, at the branch meetings that have already started to take place. The founding congress, which will discuss the political program and statutes of the new party, is scheduled to begin in September and to conclude in December.

Imperialism and Socialism in the 21st Century

The term “Bolivarian revolution” beautifully reflects the national aspiration, links up with a great tradition (of the liberation struggle led by Simon Bolivar 200 years ago) and highlights the mass activism and the radical aims of the movement. Chávez also says he is engaged in, or aims at, “transcending capitalism” and “building socialism”, albeit “of the 21st century”.

Fine. But “just as our opinion of an individual is not based on what he thinks of himself, so can we not judge of such a period of transformation by its own consciousness; on the contrary, this consciousness must be explained rather from the contradictions of material life, from the existing conflict between the social productive forces and the relation of production.” (Karl Marx, Preface to a Contribution to the Critique of Political Economy)

A host of bourgeois reforms and a spate of nationalisations do not add up to a socialist revolution. Transcending capitalism means abolition of capital-wage Labour relations and socialisation of means of production. Since this is not fully achievable at one stroke in a backward capitalist/semi-feudal country subjected to imperialist exploitation and domination, we talk of a new democratic or people’s democratic stage of revolution preceding the socialist revolution in such countries. Venezuelan communists also talk of a two-stage revolution, with struggle against imperialism as the key task of the present stage in their concrete conditions. And this serves as the principled basis for their long-standing militant unity with Chavez.

It is futile if not foolish to expect that the present economic and political program of Chavez will usher in socialism in Venezuela. In June this year, at a mammoth rally in defence of his decision not to renew RCTV’s license, Chávez declared, “We have no plan to eliminate the oligarchy, Venezuela’s bourgeoisie. We have demonstrated this sufficiently in our eight years.” (See Venezuelanalysis.com June 4, 2007). The billion-Bolivar question is, does the present social churning and polarisation – with the agenda of socialism on everybody’s lips and a distinct leftward shift in national politics -- provide a better scope for accomplishing the democratic and anti-imperialist tasks of revolution in this Third World country?

If it does, and certainly it does, then the onus rests squarely on the revolutionary Left to fully utilise that scope and thus pave the way for a forward march to the cherished goal of socialism. This is the crux of the present situation in Venezuela. Ultimately it is here, and not on the role of an individual, that we pin our hopes.

In a more immediate sense, we the Left in India have a great lesson to draw from Venezuela and its alleys in the turbulent continent. It is possible, necessary and urgent to unfurl the banner of total revolt against the imperialism of 21st century, against its lackeys, against the received orthodoxy of neoliberalism -- not only in the arena of mass movements in a general sense, but also specifically by utilising governmental powers to whatever extent possible, in spite of all ‘limitations’ and ‘compulsions’. This is the trajectory that has brought Chavez to the present stage starting from a weak and beleaguered position eight years ago and in our country too this has a tremendous potential of arousing the masses and taking the left movement forward. Is the official Left prepared to bid adieu to its own version of neoliberalism, to stop worshipping indigenous and imperialist capital in the name of development and make a bold changeover to all-out struggle against imperialism and its indigenous collaborators?

References: The agrarian revolution in Venezuela: Revolutionary realism versus reformist utopia by Alan Woods - www.marxist.com; Venezuela’s Co-Managed Inveval: Surviving in a Sea of Capitalism by Kiraz Janicke - Venezuelanalysis.com, Tuesday, 31 July 2007; and other postings on these websites. 