By Sam King
The article below was written in the aftermath of Hugo Chávez’s death on March 5th, 2013 as part of internal discussion within the group Socialist Alternative which the author was a member of at the time. It has never been published openly to the public before.
We publish it today as a celebration and commemoration of the 20th anniversary of the defeat of the counter-revolutionary coup that took place April 11-13, 2002.
Was Hugo Chávez a Bourgeois Nationalist or Socialist Revolutionary?
By Sam King, April 2013.
Hugo Rafael Chávez Frías was elected President of Venezuela in December 1998 with 56% of the popular vote and overwhelming majorities from poor and lower middle-class voters. In 1999 he presided over a Constitutional Assembly that drew up a new constitution for the country that was adopted that year with 72% of the vote.
Chavez’ election to the Presidency, his pro-poor outlook and the popular mobilisation and organisation involved in drafting, discussing adopting and enacting the new far more democratic constitution and the many pro-poor social policies of the Chavez administration that came in its wake had an enormous impact on all social classes in Venezuela.
Eventually the Venezuelan capitalist class and their allies in the judiciary, trade union bureaucracy and – most importantly – officer corps of the military, attempted to put a stop to all this and put the increasingly mobilised and organised layers of working people back in their place. Chavez was kidnapped, other ministers arrested, the parliament disbanded, martial law was declared and troops sent out to quell unrest in the poor areas on April 11, 2002 – a classical military coup.
Sadly for the hapless capitalist conspirators and the generals, they were unable to quell the mass popular opposition on the streets. Massive demonstrations eventually surrounded the Mira Flores Palace where the coup leadership was positioned. In this context a section of the Presidential Guard – that was positioned at the palace broke ranks with the higher command – a split in the armed forces.
The Presidential Guard, or its revolutionary wing, then seized control of the palace and arrested the coup leadership on April 13 bringing the conspiracy to an end and the victorious return of Chavez.
Having played their most decisive card – seizing national control using armed force – and failed, the Venezuelan capitalist class was rapidly losing its grip on state power. This failed counter-revolutionary coup and the subsequent failed attempt by the capitalist class – later in 2002-2003 to seize control of the state oil industry represented the decisive events the consolidation of revolutionary state power in the country.
These momentous events are captured from inside the Mira Flores Palace by what must be one of the most remarkable political documentary videos ever produced: The Revolution Will Not Be Televised (2003)
The new period from 2003 until Chavez’s death in 2013 was characterised by rapid and far-reaching social reforms, high levels of popular organisation and general advance of the social position, power, wealth, consumption and consciousness of the poor majority. Chavez foreign policy was also radical and far reaching.
By examining Chavez outlook against the final part of Chavez’s political career, the article that follows also gives a characterisation to that decisive period in the Venezuelan revolutionary process. It does so especially by pushing back against some of the prevailing misconceptions and even hostility towards Chavez and the Venezuelan revolution prevalent among organised socialist groups in Australia.
Was Hugo Chávez a Bourgeois Nationalist or Socialist Revolutionary?
Before the election of Hugo Chávez to the Venezuelan presidency in 1998, and for some time afterwards, few on either the left or right of politics saw Venezuela as likely to emerge as the next country were the establishment of socialism would be raised as an immediate question. What government, besides that of Chávez, has been so successful in advancing the interests of working people and the poor majority, that the principal complaint of its left critics internationally is that it has not yet abolished capitalism?
No other government since the Cuban Revolution, or perhaps the defeated Nicaraguan revolution of the early 1980s, has even been able to establish that as a possibility. Chávez and the Bolivarian Revolution have put socialism on the agenda, in a period when the international left and working class has been beaten back during the four decades of neoliberalism. That is its true historical contribution.
To understand how Venezuelan politics could swim against the rip tide of the international neoliberal offensive we need to consider three key factors: social conditions, mass struggle and the political leadership role of Chávez. Many English-speaking socialists tend to assess Chavez’s political leadership not in the context of broader social and political factors.
Social life in Venezuela is fundamentally conditioned by its position as a poor country that has been exploited throughout its history by the imperialist powers. Especially in the modern era, this exploitation has been by the largest and closest of those powers – the United States.
Oil was discovered in Venezuela in the early 20th century and since that time Venezuela’s economy has been structured around it. Not structured, as might be the case in an imperialist economy – like Norway with its Statoil – in a way designed to strengthen capitalist production more generally in that economy. On the contrary, the oil sector was developed in a way designed to complement the United States economy and its strategic interests, and to profit foreign based multinational corporations.
In practice this meant capitalism Venezuela-style failed to develop or effectively develop whole sections of the non-oil economy. Agriculture collapsed rapidly and early, creating a rapid urbanisation from the first half of the last century. By the 1980s sixteen of Venezuela’s nineteen million people were living in cities – mostly in sprawling and unplanned slums. Wave after wave of migrants arriving from the countryside would often set up houses first, only later fighting for water, sewage, electricity or other state services which are still far from adequate in some areas. The overwhelming majority of food and other consumption items were being imported and paid for with oil money.
The society could be likened to an extreme version of Che Guevara’s 1961 characterisation of underdevelopment. Che asked, “What is ‘underdevelopment’?” answering “A dwarf with an enormous head and swollen chest is ‘underdeveloped,’ insofar as his fragile legs and short arms do not match the rest of his anatomy. He is the product of an abnormal and distorted development. That is what we are in reality — we, who are politely referred to as ‘underdeveloped.’ In truth, we are colonial, semi colonial or dependent countries, whose economies have been deformed by imperialism, which has peculiarly developed only those branches of industry or agriculture needed to complement its own complex economy.”
Social consequences of distorted development in Venezuela were not just poverty, it also dictated what working people did with their lives—or didn’t or couldn’t do with them. Low production in agriculture and industry meant the majority of people were not involved in productive work and had not been for generations. It is difficult to underestimate all the profound repercussions of that fact on the lives of ordinary people and the society as a whole.
Clientelism and corruption became a structured part of the social fabric. Millions of poor and less-poor people, and, in a sense the whole society, were reliant on oil revenues. These considerable revenues were distributed via the two major political parties whose established patronage networks extended to millions of people. But the whole edifice stood on top of a wealth produced mostly by just a small handful of the population.
Such a scenario made it easier for the ruling class to buy the support or acquiescence of the small group of strategically placed workers in the oil industry. This was done through the long-established, corrupt trade unions, which were later thoroughly discredited. There was and are many other significant groups of workers in strategic industries, but these often found themselves between a corrupt trade union movement and a sea of urban poor people mainly working in the informal sector. When Chávez came to power, most of the poor majority were not employed by big capitalist firms. Millions of people eked out lives as street vendors, cooks, shop attendants or any number of jobs in the over-developed services sector as well as unemployed, criminals, hustlers or women labouring for free in the home.
Big capital benefits from this army of poor in that it exists as a reserve of labour to be employed at will. Furthermore, poverty renders human life cheap, which helps to keep wages down. However, most people’s social existence is not necessarily one of direct exploitation by big capital. They are either exploited by their own families (in the case of family business), or by petty bosses. Alternatively, they work for themselves – like the hundreds of men who walk Caracas streets each morning selling coffee from a thermos, or the women and men whose lives are spent staffing tables with a daily turnover of a few kilos of fruit, or vegetables, or soap and shampoo. Or still others selling from informal street side stalls, with trestles and marquees housing tens of thousands of pirate CDs and DVDs, with a turnover far greater than that of small Melbourne shops. In class terms, this means that there is a large petty bourgeoisie and moreover, that their influence is widespread, particularly among the mass of semi-proletarians.
Socialism assumes that production is already a social activity – that capitalism has already taken society from its previous stage of development, petty commodity production, into the modern world of social production – i.e. where the means of production can only be operated in common.
Capitalism means social production but with still private ownership while socialism will be social production with social ownership. However, the majority of Venezuelans (and the world) are not yet involved in modern large scale social production. While globalised production processes are creating an increasing degree of specialisation between nations, it is only in the small club of advanced imperialist countries – such as Western Europe, North America, Japan, Australia – that socialised production processes overwhelmingly dominate social life. Only when a revolution occurs in one or more of these countries could we expect a rapid advance towards socialism.
In Venezuela, establishing social ownership and control of formerly capitalist production and expanding the productive forces necessitates fighting against an entrenched culture of patronage and corruption which has built up over many generations. This has proven to be a difficult and protracted struggle in the absence of a large and well-organised proletariat.
Yet it is still common for many on the English-speaking left, and many Spanish speakers also, to criticise the Venezuelan revolutionary leadership, particularly Chávez (and by implication, the working class) for failing to find ways to lift their country out of its historical and objective situation. One Australian section within the broader “International Socialist Tendency” current – Solidarity – wrote in 2010, “Yet, Chávez and the PSUV have left the old structures of the state and the economy intact, giving the old ruling class the power and legitimacy to continue to mobilise.” Chávez’ “serious error” was in “failing to confront the ongoing existence of the capitalist system”.[i]
The Militant Tendency of Trotskyism for example argues that the government of Venezuela “in its own way maintains this parasitic [capitalist] class”. And “Failure” to “adopt a more radical position” in the wake of Chávez’ death will “only see it moving quickly to the right.[ii] For the World Socialist Website things are even more simple in the wake of Chávez’s death: “Chávez was a bourgeois nationalist” who’s “ill-defined” 21st Century Socialism “aims first and foremost… to divert and contain the militancy of the Venezuelan workers…”.
British Trotskyist Alan Woods falls back on a safe Marxist truism, in abstract: “The nationalisation of the entire banking and financial sector is a necessary condition for establishing a socialist planned economy, along with the nationalisation of the land and all big private firms, under workers’ control and management.”[iii]
But the real question that needs to be answered concretely is how this can this nationalisation be brought into being and be successful.
Even the better-informed First World based socialist Jeffrey R. Webber, who writes mostly about Bolivia, claimed, in 2009 for example, that “until now, oil rents” in Venezuela “have lubricated a system of moderate redistribution to the popular classes without serious attack on the concentrated assets of a tiny elite and the ongoing expansion of the private sector.”[iv]
These criticisms do not acknowledge the objective limitations, contradictions and extreme difficulties inevitably involved in trying to start a transition from capitalism to socialism in an underdeveloped country, that cannot count on the support of one single industrially advanced economy as its ally or partner. Venezuela is a country whose key ally is the tiny poor island of Cuba!
The army of First World based critics of Chavez mistake objective limitations for subjective ones, thereby inventing a gulf between the “rhetoric” and the practice of Chávez who they blame for the slow progress of the Venezuelan revolution.
Of course progress is slow in Venezuela. It is excruciating, especially for working people in that country, but also for revolutionaries watching from afar. So slow in fact that most of the English-speaking left – judging by their publications – appear not to be even following Venezuelan affairs. But what scenario could Marxists expect, other than slow and contradictory progress with frequent set-backs? Should we expect socialism in one country (as proclaimed in Stalinist Russia)? Even if that were considered desirable it is not possible in Venezuela which is neither large, nor diversified, nor far from the USA or Colombia (USA’s “Israel in Latin America” and a member of NATO).
An analogous critique of the Soviet State under Lenin was developed by the Left Communists grouped around the journal Kommunist which Lenin quotes in his April 1918 article, “Left-Wing” Childishness. The Left Communists write “… The Russian workers’ revolution cannot ‘save itself’ by abandoning the path of world revolution, by continually avoiding battle and yielding to the pressure of international capital, by making concessions to ‘home capital’…. The systematic use of the remaining means of production is conceivable only if a most determined policy of socialisation is pursued”.[v]
Lenin asks, “What do they mean by pursuing “a most determined policy of socialisation”?” Arguing “even the greatest possible “determination” in the world is not enough to pass from nationalisation and confiscation to socialisation… The difference between socialisation and simple confiscation is that confiscation can be carried out by “determination” alone, without the ability to calculate and distribute properly, whereas socialisation cannot be brought about without this ability.”
“When the working class has learned how to defend the state system against the anarchy of small ownership, when it has learned to organise large-scale production on a national scale, along state capitalist lines, it will hold, if I may use the expression, all the trump cards, and the consolidation of socialism will be assured.”
The Chávez leadership has tried to pursue a strategy that combines social and political empowerment of working people – through the social Missions, political organisation and control of production – as well as developing the national productive capacity which, in Venezuela’s current situation, inevitably means developing both the public and private sectors. These social advances are seen as crucial for preparing working people to consolidate power and run society themselves – no small task – and breaking the country from the domination of economic imperialism.
The idea put forward by Webber that there have been “no serious attacks” on capitalist property is untrue. It ignores, for example, the issue of the PDVSA – the state oil company. While the PDVSA was already formally a state company when Chávez came to office in 1998 it was in practice run like a private corporation – with the profits distributed through the patronage networks controlled by the major political parties. A share of the spoils went to capitalist families, funding shopping trips to Miami etc., while the majority of oil wealth was actually drained out of the country to multinational corporations via their relationship with PDVSA. Today the PDVSA, which accounts for one third of GDP and around 80-90% of exports, funds massive social programs. That is not just an attack on capitalist property, it is successful expropriation of the most important part of it.
Besides the PDVSA, there has been a whole range of nationalisations of capitalist property. In some cases this was capital already under workers control when nationalised, while other enterprises were subsequently placed under workers control or “cogestion” (i.e. joint control by workers and the state) after nationalisation took place. Unfortunately, a systematic left analysis of the nationalisations is difficult to find. This would need to go beyond simply looking at the percentages of the economy in public and private hands and seek to understand the dynamics and trajectory of overall economic control.
Reuters news agency compiled summaries of major nationalisations reported in 2011 and 2012. The anti-Chávez website “What next Venezuela” has a more comprehensive list starting 2007. In October 2012 right wing newspaper El Nacional, citing figures from the Venezuelan Confederation of Industries, reported that from 2002 through 2012, One thousand one hundred and sixty eight companies had been nationalised in construction, agribusiness, petroleum, commerce, food, pharmaceuticals, packaging and electricity. Four hundred and ninety-seven of these are reported to have taken place during 2011, the same year Chávez declared “the plan for the elimination of private property has only begun.”
In 2009 Venezuela nationalised a subsidiary of giant U.S. food company Cargill, who together with Monsanto control world seed production. That same year the government bought out one of the countries big banks, Banco de Venezuela, from its Spanish owners. By 2010 the government had also taken over another mid-sized bank and closed 12 private banks. That was in response to a banking crisis triggered by the global financial collapse. Far from bailing out banks (as The Wall Street Journal recommended and as the previous administration of Rafael Caldera did during a similar crisis in 1994), the Chávez government nationalised a section of them, ordered the arrest of more than 20 bankers, and confiscated assets of capitalists who surreptitiously left the country, writes left-wing academic Steve Ellner. Seized banks were restructured and opened as public companies.
In 2008, Venezuela implemented a tax of 50 percent for oil sold at prices over $70 per barrel, and 60 percent on oil sold at over $100. Then, following contractual disputes and production stoppages, the government nationalised the assets of large US multinational Williams and a range of assets from local service companies operating in the oil industry. In 2010, the government seized 11 oil rigs from Helmerich and Payne, an Oklahoma based company worth 6.5 billion dollars. Exxon-Mobil had already left Venezuela filing claims against Venezuela in the International Centre for the Settlement of Investment Disputes which has gone badly for the company.
Also expropriated were vast lands owned/farmed by a subsidiary to the multinational food giant Vesty Foods, a company controlled by one of Britain’s wealthiest capitalist families. The Vesteys, headed by Lord ‘Spam’ Vestey, are best known in this country as the former owners of Wave Hill cattle station, the site of Australia’s longest ever industrial dispute. Between 1966 and 1975 the Gurindji Aboriginal stock workers fought Vestey, first for wages and then for their land – which they eventually won – in the battle immortalised in Paul Kelly’s classic song “From Little Things Big Things Grow”.
Other major nationalisations include: the Venezuelan business of the world’s largest glass container maker, Owens-Illinois; the entire Venezuelan cement sector; all gold mining – including “one of Latin America’s largest gold veins”; Venezuela’s largest steel mills; its largest telecommunications company and largest electricity company; as well as major nitrogen fertiliser and agricultural supply companies. Iron ore extraction, steel production, all the bauxite extraction and production of aluminium are all now in state hands.
The Largest Employer in Venezuela – Polar – a food and beer giant aligned with Pepsi, was occupied by the national guard in 2009 for avoiding price controls that govern the food sector. It has been repeatedly threatened with nationalisation, due to price gauging etc, but so far has only had a few warehouses confiscated. Food production and distribution remains one of the key battles today. Price controls also govern a range of non-food items, and, as of November last year, rent.
In 2012 the government expropriated 16,479,300 square meters of land in different states around the country for use in its major public housing program to provide 3 million low-cost homes by 2018 [in fact 4 million houses were delivered by April, 2022 – ed]. This comes on top of significant expropriations of prime agricultural land and substantial increases in national food production. Land nationalisation is separate from the substantial land redistribution to small capitalist farmers and cooperatives which started much earlier in the revolutionary process.
The right-wing press, naturally, is awash with claims that all state property is inefficient, idle, being run into the ground or embezzled. These claims are highly exaggerated, and actually reflect the ambition and organisational activity of the right. However, the whole of the Venezuelan left also acknowledge the problems of bureaucracy and corruption in the state sector. How this situation can be overcome is not obvious or easy. “Workers control of production” is a beautiful slogan, but it is simplistic to repeat it without any serious understanding of what it means in practice or in the absence of organisations of workers capable of carrying it out.
The 2002-2003 bosses lockout in the oil industry is illustrative. When the bosses and their supporters in management and other sections of the workforce walked out, they took with them not just computer passwords but a host of other technical information and skills crucial for production. Hence, it was not simple for the workers to take control, and subsequently the country was immediately plunged into severe economic chaos. With the economy paralysed, working people suffered innumerable deprivations without any guarantee of victory. One family, for example, was forced to burn their furniture to cook food. This was a life-or-death battle for the revolution. Failure to restart the enormous technical apparatus of the oil industry in the context of sabotage would result in the revolution losing power. Eventually, after an all-out two-month campaign by the oil workers, the state executive from Chávez down and the military, oil production was restarted.
Today state owned, worker controlled, or co-managed production is subject to economic sabotage and disruption by the domestic and internationalist capitalist sector. In some cases, workplaces and production processes are plundered from within. Socialist writers from London, Sydney and elsewhere advise that this battle should be immediately extended to the whole economy by rapid expropriation of all capital. This advice does not take into account the actual balance of forces on the ground.
There is no Marxist principle that dictates the pace of progress in expropriating a capitalist class. The policy a working people’s government adopts on this question is in reality a tactical question dictated by concrete social realities of the country. Particularly important is the level of development of the means of production and the organisation of the working class. This is why Soviet Russia, under Lenin’s leadership, in 1921 adopted the New Economic Policy that reintroduced market mechanisms and private property to areas of the economy previously socialised. The Soviet government was re-adjusting after the previous policy of War Communism – a policy of rapid state seizures of capitalist property that was necessary to win the civil war.
In Venezuela the aim of state policy at this stage is not to immediately take over the running of all capitalist business today, but to focus on better organising and strategic areas and taking steps forward areas where workers are already more organised. Banco de Venezuela for example was neither distressed nor looking for a buyer. It was taken over primarily to give the state control of a large bank, with a national branch structure, that could be used to assist state financing of social and productive programs and payments.
Business as Usual?
In Socialist Worker Mike Gonzalez criticised the Chávez leadership for pursuing a “policy of mixed enterprises in the development of the oil industry”. It is true that even after the expropriation of Williams and Helmerich & Payne, other oil majors or service companies are subcontracted by the PDVSA to carry out particular tasks. But Gonzalez’ criticism assumes there is another option. Venezuela has the largest proven oil reserves of any country in the world, however, unlike Saudi Arabia or other Gulf states, Venezuelan reserves are neither cheap nor easy to extract. Much of the known oil exists in the form of a thick tar that is buried deep underneath Lake Maracaibo.
Gonzalez must assume that the PDVSA, without any collaboration from the major oil companies, has the technical capacity to complete exploration, extraction and processing of these tar sands. PDVSA would need to be able do this at less than the cost of production. If it were also to continue funding the accelerated national development Venezuela is undergoing it would need to achieve this feat at well below cost of production. In reality the output of PDVSA has actually declined since the nationalisations and tax hikes. But due to the PDVSA’s greater role and the much more punitive terms of contracts with remaining private capital, state revenue has not dropped (besides during fluctuations due to movements in the oil price).
Gonzalez’ ultra-leftism starts from the false premise that Marxists have some kind of principled opposition to doing deals with capitalists or with big capital. For the same reason Venezuela is also criticised for accepting low interest loans from China and maintaining oil sales to the USA among other examples. Lenin held no such principle. In fact, he actively sought foreign investment in Soviet Russia.
In practice, business deals with big capital, or even the closer diplomatic and trade relations established between Venezuela and a range of capitalist states, do not appear to have prevented expropriation of capital head-quartered in those states. It was Argentinian-Italian capital that lost control of Venezuela’s largest steel mill – SIDOR – while Russians lost Venezuela’s richest seam of gold.
Along similar lines Gonzalez and others argue that where expropriation takes place “at market prices” this too underlines the reformist character of the Bolivarian project. But for Marxists the question of compensating capitalists is strictly a tactical one.
In The Peasant Question in France and Germany Marx raised the possibility of buying out the capitalists in Britain, under specific circumstances, to facilitate a peaceful and more rapid transition to socialism. The principle is not what will hurt capital the most but what policy will most rapidly allow working people to develop their labour productivity under their own control. If paying capitalists full value for their assets means they will not cause production losses of an even greater value – then so be it. Even if that means paying “fair” or “generous” compensation. There is no suggestion, for example, that the Spanish financial group Santander were unhappy with the 1.05 billion US dollars they received for the Banco de Venezuela.
Every capitalist knows there are “market prices” and “market prices”. The Cuban government, for example, agreed to pay full compensation when it passed a law in 1961 expropriating all US business on the island – which constituted practically the whole corporate sector. The value of companies was calculated according to what they had been declaring as their value for tax purposes. Now we all know how the rich feel about paying tax. No doubt operating in a US client military dictatorship, these US businesses avoided almost all tax. And were compensated accordingly. The law stipulated compensation would be paid in long term Cuban government bonds.
Venezuela similarly has been playing hard ball while clothing this in a legal language of national sovereignty.
Venezuelan gold reserves are now kept in Caracas having been repatriated from vaults in the US, Canada and Europe by January 2012. That month, the country announced it would withdraw from the World Bank aligned International Centre for Settlement of Investment Disputes. Then Chávez claimed a victory against Exxon-Mobil in the International Chamber of Commerce’s arbitration court stating, “The ICC only awarded Exxon ten per cent of what they wanted… You can make your own conclusions”.
The conditions for conducting capitalist business operation in Venezuela, according to the World Bank, are the sixth worst in the world. It is considered to have the worst tax environment of any country, while only Suriname, Lao and Afghanistan are considered worse at “protecting investors”. For example, in 2011, claiming the “right to food”, the Venezuelan Supreme Court effectively supported land seizures by the poor by endorsing non-enforcement of criminal code sanctions against those occupying private landholdings and plots of land.
Rise of the Private Sector?
Another argument used to undermine the socialist credentials of policies pursued under Chávez is to point out that the private sector has grown faster than the public sector in the Chávez era. It is true, according to the Banco Central de Venezuela, that under Chávez’s presidency the public sector grew on average 2.8% per year while the private sector grew 3.0%. However, these statistics cannot be taken at face value. They assume the PDVSA, which accounted for one third of the economy, was in public hands when Chávez came to power. These figures also do not count massive expansion in public health and education which is free and not sold as a commodity. Nor do they say anything about qualitative changes in economic structure taking place.
Venezuelan GDP growth has gone from 1.4% annual growth in the 13 years before Chávez was elected, to 4.3%, calculated from the year after the Chavistas took control of the PDVSA (with a slower growth from 1999 and 2003). Having taken control of the army in 2002 through defeating the counter-revolutionary coup, and then the PDVSA by early 2003, the Chavistas were finally able to implement the first stages of their program. They commenced a massive campaign to expand social programs and other wealth transfers to working people such as: financial support to poor single mothers; expanding and increasing retirement benefits; and large wage increases.
According to Chris Carlson of Venezuela Analysis “This significant decrease in poverty and the massive increase in household consumption, along with the continual growth in population (which grew by 23 percent from 1999 to 2011), translated into significant increases in demand for basic goods and services.” As people became better off, many bought more food, building materials, phones and cars. Most of this extra demand was met by the private sector. Yet the majority of private sector “growth” comes from simply selling imported products.
That is not to say the state has not attempted to increase its production in a whole range of areas and attempted to meet demand where possible. The Canaima laptop production and assembly plant in the state of Miranda is one of the most successful examples. It is expected to produce 1.2 million laptops this year- more than enough to flush the school system with quality computers. For the most part, however, the Venezuelan state sector – as it was inherited – could not meet all the needs of modern working people. So naturally the capitalist class, foreign and local cashed in. By 2008, the government strengthened capital controls to curb imports in non-priority areas. Imports then focused more on food and medicine at the expense of automobiles and other non-essential items.
If you take the period since 2007 public sector expansion almost tripled private sector growth. In fact public investment has been steadily increasing its share of the total since 1999, overtaking private investment as the majority component in 2006 and continuing to increase its share up until 2010 when those statistics stop.[vi] According to Norberto Bacher’s 2013 article Notes on the Devaluation, “since the [currency] devaluation of 2010 the sector of the economy under state control – productive, commercial and financial – has grown significantly, although a part of this is still subsidised and shows serious inefficiencies.” Chávez’s proposals for 2013-2019 call for state incursions into transport and trade.
“Everything Rests on the High Price of Oil”
Mike Gonzalez in 2007 argued that, “everything rests on the high price of oil”[vii]. Five years later Webber wrote that “Oil has been the lubricant maintaining the flow of resources to social programs”. While Webber’s statement is true at a high level of abstraction, the global economic crisis and decline in oil prices actually hit the private sector much harder than the state sector.
Resembling right-wing criticism of Chávez, the social programs are seen as profligate spending, nice for a while, or good for winning elections, but in the end, bound to dry up in the future when the mass of people will be left with nothing. This view ignores real social advances that working people have made and towards building a political economy that is not able to be held to ransom by imperialism. Rising education and health levels, in this context, are not merely welfarism or social democracy, but an important part of increasing working people’s social consciousness, organisation, confidence and the social productivity of their labour.
These are basic preconditions for breaking oil dependency, and national oppression. The incredible social missions, such as Mission Sucre, the mass literacy program, have been carried out in the context of a liberation project. This context gives them an entirely different social content and character to institutions like the stultifying school system in countries like the UK or Australia.
In an abstract counter factual Webber writes that in the “relative absence” of high oil prices, “zero sum class decisions regarding the future character of Venezuelan development will rise much more sharply to the fore.” Elsewhere he writes “The game, ultimately, is not a virtuous circle of mutuality, but a zero-sum competition of classes with opposing interests.” This may hold true at a high level of abstraction but as a tactical approach it ignores the objective conditions prevailing Venezuela.
The revolution is taking place in an under-developed country. i.e. one whose capitalism is under-developed. This means that once the political power of imperialism, the multinational corporations and their domestic servants was broken, it has been possible to re-orient the economy towards rapid domestic development of both public and private property. This rapid economic development – of both social and private property – is a necessary initial step towards overcoming backwardness resulting from Venezuela’s national economic oppression by imperialism.
In an under-developed working people’s state, the private sector has to operate where the workers are still too weak to do so, otherwise working people can’t eat, work, travel etc. In such a scenario, obviously the revolutionary movement would lose power were it to try and suppress all private property. Rapid development of private business in productive spheres, under a working people’s state, is in the interest of society as a whole because it raises living standards, increases the size of the proletariat and raises the level of organisation and productivity of workers. Because these advances are taking place under capitalist relations of exploitation, it will also tend to socially and politically prepare working people to soon expropriate the capitalists and take production into their own hands.
This view of the transition to socialism in under-developed capitalist economies, which reflects Lenin’s thinking, should not be confused with the Menshevik view (adopted by Stalin at different times) – in practice an anti-revolution view – that development of the national productive forces would take place under the political leadership of the bourgeoisie. In practice the Stalinist policy meant advising and even organising workers not to take power. Lenin assumed working people must have state power as a pre-requisite for any progress towards socialism – regardless of the specific sectoral mix of the economy this state presides over or the length of time necessary for the transition.
Pro-Capitalist Foreign Policy?
It became common after the 2006 Israeli invasion of Lebanon to see pictures of Chávez held up at actions in many countries of the Middle East. Chávez has consistently opposed imperialist wars and invasions. In 2001 Chávez made headlines when he spoke on live television against the US led invasion of Afghanistan by showing pictures of maimed Afghani children – victims of US bombing. Chávez later earned himself a reputation as a consistent and outspoken critic of Israeli and US policy in the Middle East, condemning the Israeli invasions of Lebanon and Gaza, and earning himself widespread support throughout the Arab world and beyond.
However, for some leftists his record has been undermined by appearing on friendly terms with reactionary regimes. Webber states “the international legacy of the Venezuelan president for sections of the left has been tarnished by his appalling support of Gaddafi, Assad, Ahmadinejad and the Chinese state.”[viii]
However, it is hard to find a wrong policy in relation to all these regimes on the key issue that the international left has had to act on – imperialist intervention. In relation to NATO aggression against Libya, Chávez, after Fidel Castro, was among the first on the international left to adopt a position of total opposition to NATO intervention. In contrast, parts of the socialist left actually caved in, at the time, to NATO / pentagon propaganda that NATO must intervene to stop a supposedly impending civilian massacre in Benghazi. Castro and Chávez clearly and immediately opposed imperialist intervention and Chávez offered to broker a peace deal between Gaddafi and his Benghazi led opponents – something that, if successful, would have saved tens of thousands of lives and weakened the hand of Imperialism in the Arab uprisings.
In the case of Iran, clearly the biggest issue the international left needs to prepare for today is escalation of imperialist aggression. Opposing imperialist intervention in Iran should be obvious for any Marxist or anti-imperialist. Likewise, the left will need to be ready to condemn future escalations of aggression against China, a country encircled by US bases in Japan, South Korea and Singapore.
Leftists who have not achieved state power can and should maintain complete freedom to criticise reactionary capitalist regimes such as Ghaddafi or those ruling in Syria and Iran, while defending them against imperialist aggression. However, the Venezuelan president, who is a head of state, does not have such freedom to say whatever to whoever.
Venezuelan foreign policy under Chávez should be viewed as highly successful. It has revived OPEC, advanced Latin American regional integration, obtained cheap finance from China, brokered important business deals with Iran, Brazil, Argentina, and even Colombia. It has played an important role in turning international opinion against Israel and the US. If the cost for all these things and of the actual survival of the Venezuelan revolution, is to be photographed shaking hands and smiling with some pretty nasty heads of state, that is a small price to pay. It is not something for which leftists who have no experience of state power, nor any real notion of the actual needs, imperatives and options open to Venezuelan foreign policy have any real basis to criticise.
The other argument raised against Venezuelan foreign policy is to characterise the massive and important international program of social solidarity, carried out by Venezuela and Cuba, to countries within the ALBA trading block and across the world as simply “foreign aid”- essentially identical to that carried out by capitalist countries. Most essentially, this argument is simply a statement of misunderstanding what capitalist foreign aid is. Capitalist foreign policy always aims to bring advantage to the “donor” country. It is difficult to deduce how Venezuela’s remaining capitalists could hope to benefit from, for example, using oil revenues to fly Bolivian working people to Havana for free eye surgery, or from helping fund the roll-out of health services across Bolivia.
An article in Solidarity Magazine from November 2012 argues “organisation that can encourage the struggles of workers, peasants and students and push beyond the limits imposed by Chávez’s project is going to be necessary.” It then quotes Rosa Luxembourg: “Socialism will not and cannot be created by decrees; nor can it be created by any government, however socialistic. Socialism must be created by the masses… where the chains of capitalism are forged, there they must be broken.”
Luxembourg’s comment is in reality borne out by the experience in Venezuela. Progress has been very slow precisely because government power, or even state power, alone is not enough. Popular organisation and consciousness has exploded in Venezuela since Chávez was elected, though not to the degree necessary for an extremely rapid move towards socialism – something that is not possible in an isolated third world country. Solidarity’s addition that these limitations are “imposed by Chávez’s project” is not substantiated by any reference to actual developments in Venezuela. Or perhaps Solidarity believe that “Chávez’s project” i.e. fighting for socialism in the conditions that actually exist – should be abandoned for another project.
A characteristic of the Chavista government has been its consistent attempts to stimulate the formation of organisations of working people. The 20,000 communal councils set up to take charge of their own neighbourhoods is one significant example of this. Like all such attempts, it has had mixed success. The communal councils are not controlled by the government and in fact many councils formed in rich neighbourhoods are against the revolution. The national government shifted part of its budget to directly fund Communal Councils in an attempt to consolidate more direct majority control of the state. But the extent to which that has been possible has been limited by the highly varied level of organisation in different areas.
More recently several hundred “Communes in Construction” have been established. Each of these link a dozen or more communal councils to run projects that are not communal or local in character but regional, like gas and water distribution. Chávez proposed creating new Communes in Construction to represent over two thirds of the population. Left Academic Steve Ellner writes “The communes are to be granted the same prerogatives as state and municipal governments, including budgeting, participation in state planning and, eventually, tax collection.”[ix] Both the communal councils and regional communes are clear and conscious attempts to create a completely new and popular state structure directly controlled by the majority of people.
Often popular organisations formed organically out of past struggles remain the strongest today. A well-known example is the Coordinadora Simón Bolívar in Barrio 23 Enero, a massive sprawling and historically militant barrio in the inner West side of Caracas. The Coordinadora now operates from the old Barrio 23 police station sitting right in the heart of the community. The building includes towers designed to shoot from and a basement that was used as a torture centre. Residents laid siege to the cops and expelled them completely from the station and the Barrio – one resident was shot dead in that fight. The Coordinadora Simón Bolívar now occupying the building is an alliance of major popular organisations active in the social and political life of the community. It houses a community radio station and activist’s offices, and the space is used to run meetings and for education.
Gonzalo Gomez describes a range of social movements in Venezuela today which include “a powerful, organised peasant movement”, the Movement of the Urban Poor, which “has been involved in the struggle for renters’ interests, and in the struggle for gaining title to squatted lands in the city”. A powerful alternative media has developed, as has the Feminist Alliance. The Revolutionary Alliance of Sex-Gender Diversity, “has brought into the revolutionary camp the movement of lesbians, gays, bisexuals, and transgender people who are “for the first time actively participating in the popular movement.” According to Gomez “It’s also necessary that there be more organic consultation and participation of the social movements in the leadership of the government. This, still, is not very advanced.”
However, to move from the present capitalist economy towards socialism it is necessary to move beyond purely barrio or community organising, to workers’ organisation in workplaces – something that is historically weaker in Venezuela. As Lenin put it “when the working class has learned to organise large-scale production on a national scale” it will hold “all the trump cards”. The Chávez period has proven to be a impetus towards a powerful workers control movement that has arisen over the last 8 years.
In 2005 the first worker-controlled factories came into being when the Chávez government expropriated paper factory Invepal and valve factory Inveval, after workers launched occupations against the former owners. This was championed by Chávez at the time using the slogan “company closed: company occupied.”[x]
Ewan Robertson writes in Venezuela analysis that from 2005 many factories have been occupied and put under various forms of worker control, including state-owned Aluminium factory Alcasa, Invetex, Central Pío Tamayo, Sideroca, Tomatera, Caisa, Central Cumanacoa (2005/6), Sanitarios de Maracay (2007), Grafitos del Orinoco (2009/10), the food chain Friosa (2010), coffee producer Fama de Amerca (2010).
According to Robertson “despite the number of factories under worker control representing only a small part of Venezuela’s economy” the “general trend has been a growing number of concrete examples and the popularity of the idea of worker control among Venezuela’s working class”.
In April 2008 workers at the giant SIDOR steel mill emerged victorious from a 2-year battle that had started as a dispute over a collective agreement and ended in the nationalisation of the company under workers’ control. Chávez intervened to sack his labour minister and resolve the dispute in the workers’ favour by presidential decree. It was an important and high-profile workers’ victory that greatly assisted workers’ confidence and militancy, in turn leading to a massive expansion of the workers control movement, especially in Guayana, the industrial heartland of Venezuela.
Following the SIDOR victory, workers from industrial plants across Guayana – which directly employed over 30 000 workers – began meeting to discuss the future development of the state industries. Meanwhile Chávez established the Guayana Presidential Commission with representatives from the national executive and links with the workers to debate the issues. Then on May 21, 2009, over 400 worker delegates divided into ten working groups before meeting with Chávez to present their proposals for the socialist transformation of Guayana’s basic industries under worker control, the Plan Socialist Guayana, which aimed at ending division between intellectual and manual labour.
According to Robertson, the goals of the Plan Socialist Guayana are spelt out in its June 2009 report as “control of production by the workers”, which it states, requires democratising the management and decision-making of companies. Second, “the development of a revolutionary theory and action that puts workers in active and participatory control of production. This focuses on promoting “socialist values” through collective leadership mechanisms as well as a focus on health, safety and care for the work environment.”
Thirdly, “integration of all.. industries into two mega companies, one integrating the iron and steel production process, the other, the aluminium process.” Which, the report argues, will create a wider consciousness beyond workers’ commitment to their particular company, to the wider Guayana region and Venezuelan society.[xi]
Robertson writes that by mid-2011 the Bicentenary Front of Companies Under Worker Control (FRETCO) was able to declare: “Currently, the Bolivarian revolution has entered a critical point in which the bourgeoisie has lost control over the exploited. The workers have been acquiring an ever-greater level of political consciousness and are organising themselves to respond to the capitalists’ attacks”. However, the results have been mixed. In many individual factories – for example Grafitos, a small 55 worker supplier to SIDOR – workers control is a well-functioning exciting reality, while in other factories, counter-revolutionary forces are undermining it.
Opponents of worker control include: state bureaucrats and industry managers, the Bolivar State governorship; transnational companies, who historically purchase much of the region’s product; mafia or other criminal networks, including workers who are organised into them; and a labour aristocracy, controlling right wing sections of the union movement which is often linked to mafia or other capital. In short, in conjunction with big capital, there exists a plethora of petty bourgeois elements who oppose workers control and socialist revolution and who therefore seek to sabotage it.
An important section of petty bourgeois counter-revolutionaries exist inside the state apparatus and appear periodically in Red Chavista hats. In Left Wing Childishness, Lenin identified the petty bourgeoisie as the principal enemy of soviet Russia in 1918, arguing,
“They do not believe in socialism or communism, and ‘mark time’ until the proletarian storm blows over. Either we subordinate the petty bourgeoisie to our control and accounting (we can do this if we organise the poor, that is, the majority of the population or semi-proletarians, around the politically conscious proletarian vanguard), or they will overthrow our workers’ power.”
A detailed assessment of the workers control movement, and its relationship to the Chávez government and Venezuelan state would reveal the movement’s class character. A useful starting point, published in English, is the extensive interview by Jeffrey R. Webber with Venezuelan Trotskyist and founder of the Aporrea website Gonzalo Gomez. Gomez is from the party Marea Socialista (Socialist Tide).
Like the international left critics of Chávez, Gomez would like to see “an acceleration, a democratic radicalisation, of the revolutionary process, with more audacious and radical measures that rupture with the existing capitalist system.” However, he also acknowledges “these measures will have to recognise the reigning balance of forces, obviously.”
“I believe that achieving workers’ control will never come from the government merely giving a directive for workers’ to assume that role. The working-class needs to achieve a certain level of organisation and consciousness, it has to have its own leaders, and it has to be carried out in a dynamic of struggle. If there is no dynamic of struggle, the attitude of the people is to wait for the government.”
“If there is no dynamic of struggle and mobilisation within the workers themselves that make this a possibility in reality you are not going to see actual workers’ control installed. The enterprises will instead be managed by the government. And with the structure of the state that currently exists, given the fact that we have not superseded capitalism, with all of these processes of bureaucratisation inside of the state and with many legacies of the Fourth Republic still intact in the state, the slogan of workers’ control will be distorted.”
“The problem of workers’ control is not a question of bureaucratic implementation; it’s our problem to solve. It’s a question of our organisation, our maturity, our development, and our political and organisational capacities as the working-class, a working-class that is uneven in its experiences. For Gomez “The idea that this could be calmly normalised when the capitalist system continues existing is delusional”
“The government is a close interlocutor of ours, sensitive to our demands, and it pushes various actions forwards and provides an orientation; but at the same time, the bureaucratic apparatus of the state often acts as a brake on all advances. The bureaucracy appropriates the discourse of the revolution, but in reality, rather than living for the revolution, they live from the revolution. They accumulate capital, negotiate with the bourgeoisie, and reject real changes.”The Revolution Will Not Be Decreed: An interview with Gonzalo Gómez, Gonzalo Gomez, Jeffery Webber and Susan Spronk, 2012
The above analysis by Gomez and in this article shows that, far from representing a radical version of bourgeois nationalism or reformism, Chavismo is essentially a revolutionary current that aims to overthrow capitalism and replace it with socialism. However, it is critically limited and distorted by objective social and political conditions.
If we accept such an assessment, does it disprove the Marxist theory of the state? For Marxists, workers cannot advance towards socialism by taking over the existing capitalist state. On the contrary they must “smash” the capitalist state apparatus and replace it with a completely new state of their own.
The short answer is “no”. Chávez did not assume state power when he took the office of President in 1999. State power passed to the Venezuela’s working people through victories in the two decisive class battles that occurred in 2002 – 2003. The term “working people” here refers to the class alliance of the Venezuelan proletariat and semi-proletariat with poor non proletarian urban masses and small farmers.[xii]
As is well known, the counter-revolutionary military coup in April 2002 was led by the head of the Venezuelan business Federation Pedro Carmona, right wing generals and politicians, the capitalist media and was backed by the USA. It attempted to establish a military dictatorship that, like in Chile, would aim to wipe out the left and terrorise working people into submission. One has to ask, how were the Chavistas able to defeat this attempt to establish capitalist military rule when Aristide, Zelaya, Allende and others failed?
The Carmona coup regime survived in the Miraflores Palace in Caracas for less than 48 hours. There is a lot of writing on the popular insurrection that defeated this regime. However, from a theoretical perspective two facts are decisive. Firstly, the new government was paralysed (literally surrounded and trapped inside the palace) by an uprising of working people in Caracas that was organised by the mass organisations in every popular barrio. Secondly, after the civilian insurrection surrounded the Miraflores Palace, a section of the lower ranks of the military broke the military chain of command and arrested the coup government. This act smashed the counter-revolutionary general’s military chain of command.
Through these two acts, decisive military power passed from counter-revolutionary generals and their collaborators in the coup regime to a regime that leaned on the urban masses and army rank and file for its power. Less than a year later, defeat of the bosses’ lockout in the oil industry allowed the revolutionary forces to gain decisive control over state finances.
It is clear with control of the military and finance, that the most decisive elements of state power had passed to Venezuelan working people who were represented by the Chavista leadership and were based in massive grass roots organisation. That is not to say working people captured total control of all aspects of state power – importantly much of the police, large sections of the state bureaucracy, some provisional governments and even some sections of the army were and are still controlled by the counter revolution. However, revolutionary control over the decisive heights state power – that is the power to decide which class or classes govern – shows why the advances made by Venezuelan working people over the last decade have not been drowned in blood. These advances represent a real and present danger for the future of capitalist rule in Latin America. No capitalist class would willingly allow such dangerous developments to continue. Sadly for the Venezuelan capitalists, their 2002-3 attempts to nip in the bud such dangers resulted in the destruction of their power.
While the army may still wear basically the same uniform, the bourgeois chain of command has been smashed. Since the coup, known counter-revolutionaries have been removed from their posts. Venezuela withdrew from the School of the Americas in 2004.
A general reorganisation and expansion of the armed forces includes the creation of a 120,000 person “Cuban style” civilian militia, strengthening of reserve forces and the creation of “rapid response groups” of soldiers and civilian supporters to deal with potential crises. Today, soldiers must swear allegiance like this: “Patria, Socialism o Muerte – Veneceremos!”, “Motherland, Socialism or Death – We Will Win!”
Inevitably there are all sorts of weaknesses and distortions of this new power, and there is no guarantee it can survive given its isolation in an imperialist dominated world. However, it is what we might call an “ultra-left to conclude from these weaknesses and limitations that the whole project – a project that has politicised and inspired millions of working people across the world – is a waste of time.
The ultra-left logic leading to that conclusion says, on the one hand, “you are not socialist because you cannot bring about socialism today” and on the other hand “you cannot bring about socialism because you are not proletarian enough”. Conclusion: “you should not have taken power – you should not even exist”. This is why sections of the international left largely ignore Venezuela and Chávez. Apparently, we have nothing to learn.
Lenin’s approach was the opposite. His was far more combative: “it would be a fatal mistake to declare that since there is a discrepancy between our economic ‘forces’ and our political strength, it ‘follows’ that we should not have seized power. Such an argument can be advanced only by a ‘man in a muffler’, who forgets that there will always be such a ‘discrepancy’, that it always exists in the development of nature as well as in the development of society, that only by a series of attempts—each of which, taken by itself, will be one sided and will suffer from certain inconsistencies—will complete socialism be created by the revolutionary co-operation of the proletarians of all countries.”[xiii]
It is in this context that we should see Hugo Chávez, who came to adopt revolutionary socialist thinking through the process of serious, committed struggle to change the social conditions for Venezuelan people, as the first great revolutionary socialist leader of the 21st century. Though he certainly won’t be the last.
[i] Shannon Price and Ian Rintoul, Venezuela: Revolution stalled? (2010).
[ii] Johan Rivas, The ‘Bolivarian Revolution’ and its prospects after Chávez, (2013).
[iii] Alan Woods, Venezuela: The nationalisation of Banco de Venezuela, (2008).
[iv] Jeffrey R. Webber, Red October: Left-indigenous Struggles in Modern Bolivia, (2011) p326.
[v] V.I. Lenin, “Left-Wing” Childishness (1918).
[vi] Mark Weisbrot and Jake Johnston, Venezuela’s Economic Recovery: Is it Sustainable? Center for Economic and Policy Research (2012).
[vii] Mike Gonzalez Interview: Venezuela—tensions within the process, International Socialism (2007).
[viii] Jeffrey R. Webber, What is Hugo Chávez’s Legacy? Socialist Worker (2013).
[ix] Steve Ellner, The Chávez Election, The Bullet (2012).
[x] Ewan Robertson, Revolutionary Democracy in the Economy? Venezuela’s Worker Control Movement and the Plan Socialist Guayana, venezuelanalysis.com (2012).
[xi] See Robertson.
[xii] In Venezuela “working people’s” state power is the most accurate way to describe the class character of a state based on the alliance of both the exploited and the oppressed classes. That is on the class alliance of the proletariat and semi proletariat with the urban poor petty bourgeoisie and poor farmers. The term “workers and farmers” has been used to describe the character of state power that in the Cuban and Nicaraguan revolutions represented a similar same class alliance. In Venezuela, however, the decline of agriculture through the 20th century and massive urbanisation mean that small farmers make up a relatively small section of the petty bourgeoisie masses the state, in part, relies on for its rule.
[xiii] Lenin, “Left-Wing” Childishness.