Venezuela: Oil wealth, capitalist plunder and resistance

Venezuela was never as important for the Spanish empire as its other colonies. Colombia was vital for its coffee, Peru for its gold and Bolivia for its silver; they all assumed a greater importance than Venezuela. Cocoa became Venezuela’s only important commercial product during the 17th Century. Cocoa was exploited using the slaves who were transported from Africa, along with some of the indigenous people. They suffered inhuman treatment inflicted by the colonisers and their descendents.

The following article was written by Gustavo Brito and Celso Calfullan, from Caracas, on 18 June. It looks first at the history of Venezuela and the importance of its oil industry. It then deals with the rise of the radical regime of Hugo Chávez, the right wing opposition’s reaction to his policies, the recently called ‘recall referendum’ and how to defend and to extend the revolution.

Oil wealth, capitalist plunder and resistance

Venezuela before the oil

Later, during the War of Independence (1811-1821), the economy was devastated. This was compounded by the participation of Venezuela in the wars of independence fought in other Latin American colonies: Peru, Colombia, Panama, Ecuador and Bolivia.

At the end of the War of Independence, the big families of the ‘claudillos’ were installed in power and the presidents from then on used modest military power to ensure their position and rule of the population.

In the middle of the 19th Century, Venezuela began to produce coffee. However, from the colonial-era, Venezuela maintained ‘mono-production’, which never allowed significant national economic development.

During this period – most of the 19th Century and the beginning of the 20th century – Venezuela began to be controlled by an oligarchy, which turned the country into its own ‘hacienda’ or big landed estate. This fomented a mono-culture of coffee and resulted in the oppression of the most downtrodden; firstly as slaves and then as very poorly paid peasants.

Oil is found

Although the indigenous peoples and the Spaniards knew of the existence of oil (‘Mené’, as the indigenous people called it), the exploitation of hydrocarbons only began to take place seriously after 1917. By 1904 exploitation was already regulated. The president was given total power to make concessions that he thought necessary to encourage the oil companies. He fixed a tax rate at 25% – a gift to the oil companies – which at the time caused problems for the president at the time. Not surprisingly, the tax giveaway was accepted by the British companies that virtually controlled all of the petrol production.

At the end of 1919, following the First World War, bigger concessions were granted to US companies. The US began to understand the strategic importance of Venezuela for the production of petrol because of its geographical location and its large reserves of this rich commodity.

Brief résumé of the governments of AD-COPEI

Through a coup in October 1945, the Partido Acción Democrática (AD – a social democratic organisation), together with some sections of the junior military officers, defeated a nationalist government. Following the subsequent elections, the writer Rómulo Gallegos, a member of the AD, won the Presidency and proposed a new law to control oil production. This included a proposal that the companies must pay over 50% of their profits to the state. Although this social democratic party presented itself as being “of the people”, the big economic benefit from the higher tax was not distributed to the most oppressed layers who had abandoned the countryside and moved to the cities.

In 1948, only a few months after President Gallegos had assumed power, a military decree put an end to the “novelty” of “democratic government”. It was undertaken by the same sections of the military that had helped Gallegos to power in 1945. This coup established a military Junta that included Pérez Jiménez, which would eventually govern Venezuela until January 1958.

The dictatorship of Pérez Jiménez (1952-1958) coincided with a flood in oil income and a massive public works programme which that gave the country a sense of “progress”. However, when workers attempted to use their rights, which were guaranteed in the constitution, and fought for their demands, they were imprisoned under the “Security of the State” and some even lost their lives.

In the period 1958-1998, “democracy” was installed in Venezuela, which corresponded to the needs of the big economic interests and US imperialism. During these 40 years (due to the sale of oil) the income received by Venezuela was equivalent to 15 times the amount spent on the Marshall Plan invested in Europe following the Second World War. But “15 Marshall Plans” only resulted in a widening of the gap between the rich and the poor. The population of Venezuela during this period increased from 7 million in 1958 to 23 million in 1998.

Rómulo Betancourt (AD, 1959-1964) and Raúl Leoni (AD 1964-1969) used their mandates to fight against left-wing parties and to direct the financial resources that had come from the oil industry, to the ruling class.

During the first mandate of Rafael Caldera (1969-74) there was an attempt to increase the level of state holdings in the oil industry to 60%. Nevertheless, this first government of the Social Christian Party (COPEI) only ended up consolidating the capitalist class in the different branches of the state. These forces not only wanted the economic benefits of the oil branch of the economy but they also wanted to be included in decision making.

The first government of Carlos Andrés Pérez (1974-1979) coincided with a period of a big increase in the price of oil, which brought with it an increase in revenue for Venezuela and also an increase in political ‘populism’. This populism pushed Pérez to the point of giving a ship as a present to Bolivia (even though Bolivia has no access to the sea) but the Venezuelan poor were still left to starve.

The petrol industry was “nationalised”, old refineries were purchased at the price paid for new ones, and massive amounts of compensation were paid to the US companies. The working class never benefited from this new stage in the development of this crucial industry. However, a new class of “technocrats” were formed around the new national oil company, PDVSA. They formed a state within a state. The “technocracy” was the senior managers within the PDVSA and the structures they created within this “national company”.

The 1980s was an era of an oil bonanza, when Venezuela received the highest ever revenues from the sale of oil. But the masses endured a deep economic crisis. Big sections of the population were exploited by a capitalist system that had accumulated vast resources but which did not ensure an equal distribution of wealth.

It was against this background, during the second government of Carlos Andrés Pérez, that the Venezuelan people came onto the streets to seize food because they simply had no money to buy any. The masses filled the streets – firstly with people and then with blood. Following Presidential orders the army was used to “restore public order”. This meant government forces killed people to preserve the well-being of the capitalists.

This was the first big crisis in a country with enormous resources but where 80% of the population were living in conditions of poverty. It represented a collective awakening by working people and an attempt to find a way forward.

Venezuela continues to be a country of strategic importance, mainly because of its energy resources. However, its historically oppressed population increasingly understands that its greatest wealth does not lie underground but in the profundity of its ideals, its actions and its unity as a class.

Chávez’s rise

At the beginnings of the 1980s, when Venezuela was approaching the bicentenary of the birth of Simón Bolívar (1783-1830), the leader of national liberation struggles throughout Latin America, military intelligence was already aware of the existence of a group of young officers who were discussing in the barracks the ideas of Bolívar and the emergence of a nascent nationalism but one without any well-formed ideas. In February 1989, while the poor grew in Caracas and other cities, some of these “revolutionaries” from the military understood that the use of the armed forces to repress a hungry people could not continue to be the basis on which a bi-party dictatorship could be sustained as a ‘democracy’.

It is important to note that Venezuela is distinct from other Latin American countries in that the armed forces include a lot of aspiring officers who come from families with very limited economic resources. This is partly because the military academy offers a salary, food and hospitality. However, in the universities, students are only given food and many of the students are unable to pay for their other requirements.

A previously unknown colonel from the Venezuelan army, Hugo Chávez Frías, son of a school teacher, was part of the group of officers who were discontented with the “bi-party democracy”. In 1992, Chávez led, together with three of his comrades, a military insurrection that sought to overthrow the then President, Carlos Andrés Pérez. According to their later pronouncements, Chávez and his aides aimed to establish a ‘Civil Military Junta’ of “notable people” that would put the country onto a new track.

This military rebellion failed in Caracas, where Chávez was in command, although it was successful in other important cities of the country.

During the morning of 4 February 1992, following hours of confrontation, Hugo Chávez spoke live to the country and asked his comrades to lay down their arms because of the defeat of the rebellion, and to “resume” their responsibilities.

Chávez’s words were received with great hope by the majority of the population who, according to the opinion polls at the time, supported the attempted coup by up to 70%. The ex-President from the Social Christian Party, Rafael Caldera, in a speech to the National Congress, described the situation: “You cannot ask the people to support democracy if the IMF is allowed into the country with the feeling that it is it’s own.” Political analysts say that Caldera made this speech with the objective of trying to win the next Presidential elections due in 1994. Chávez has said that Caldera was an “unwanted child” of the 1992 attempted coup.

In his public announcement, Chávez’s first words were: “Comrades, for now we have failed…” but he had almost the immediate support of the people as the leader of the insurrection. Venezuelans had not seen (at least in recent history) a man prepared to take decisive action to improve their lot and to assume responsibility for what he had done. Chávez was arrested and nothing was heard of him until Caldera, in a surprise move to try and win the Presidential election in 1994, ordered his release.

From the moment Chávez came out of prison until the day he was elected President (December 1998), he travelled to every corner of the country explaining his ideas for constitutional reform, etc. Although lacking a clearly anti-imperialist content in his speeches, the people sensed that he represented a step forward in the struggle against a system which historically oppressed them. Chávez thinks of himself as the incarnation of the aspirations of the people. However, there is not much clarity about his ideas, which is the real need of working people. To struggle for the oppressed, without struggling against the oppressors, is not the road that will lead to the liberation of one class, even if it maintains the hopes and expectations of working people.

The April 2002 coup

The first measures taken by the Chávez government weakened some interests of the dominant economic groups (These included the laws relating to: Land reform, hydrocarbons, fishing, and others enacted by the Executive Power, with the authorisation of the Legislative Power.) These increased the determination of the opposition to overthrow the Chávez government. With the approval of the Bush administration, the Venezuelan opposition initiated a series of employers’ lock-outs or so-called “strikes”, and other actions aimed at destabilising the government.

In December 2001, the first “strike” was called. This allowed the opposition to test out its forces before capitalising on the attempt to defeat the Chávez government. Frequent visits were made by the leaders of the opposition to Washington. The media presented such visits in such a way as to show that they had the support of Washington in trying to remove Chávez from power. From that point on, Chávez told his opponents that if they wanted him out they should use the mechanism afforded to them in the ‘Bolivarian Constitution’ – the recall referendum. The opposition forces at that time argued that the country could not wait so long to remove the President (The constitution lays down that this mechanism could not be put into effect until August 2003).

During the first months of 2002, massive demonstrations took place involving both government supporters and the opposition. At the same time, the opposition waited for the right moment to strike and to organise a coup. They demanded that the President “resign”. In order to try and force this, they attempted to create a general climate of “ungovernability”. However, they never fully achieved this.

Nevertheless, Chávez provoked a crisis in the “nationalised” petrol company, PVDSA, which is linked to the big US corporations, and is dependent on them for technology. Chávez attempted to appoint a “Junta Directiva” that would respond to the “interests of the nation”. This provoked a climate of discontent and opposition amongst the “technocrats” that dominated the operations of PVDSA.

This first petrol crisis provoked a chain reaction that was welcomed by the planners of the attempted military coup. On 11 April 2002, a demonstration was called by the opposition at the gates of the headquarters of PVDSA. This followed several days of the employers’ lock-out, which had included a shut down for three consecutive days of the TV and media networks. During this period, they only broadcast reports of opposition demonstrations.

To test their support, the leader of the employers’ organisation (FEDECAMARAS), Pedro Carmona, and Carlos Ortega, the social democratic leader of the trade union confederation, CTV, urged their supporters to protest outside the Presidential Palace, Miraflores, to demand that Chávez resign.

The Presidential Palace was surrounded by supporters of President Chávez but a physical clash was prevented from taking place between the protestors. However, both groups of demonstrators were fired upon by, as then, unknown armed groups. Following these attacks (later shown to be organised by sections of the opposition), a series of announcements were made on the private TV channels by senior military officers associated with the attempted coup, They demanded that Chávez resign and accused him of responsibility for the shootings against unarmed demonstrators.

A brief dictatorship was installed, from 12-13 April, and started to repress many of the popular leaders who supported Chávez. There was no news about the deposed President and Ministers, but MPs, governors, and other official representatives were taken by force from their homes and workplaces by the right wing conspirators.

They began brutal repression, which did not last long, but which did a lot of damage. The Cuban Embassy was surrounded by opposition supporters who demanded that the Cubans refused to offer exile to government supporters. Water, light, and telephone services were cut off to the Embassy, with the full complicity of the municipal authorities. These authorities tried to present themselves as “mediators” and demanded the right to inspect the Cuban Embassy to satisfy themselves that nobody inside had been given asylum. This was against all the norms of international diplomatic relations. No leader of the deposed government was found. It was a propaganda point used by the Cuban-Venezuela mafia that is linked to reactionaries in Miami, who wanted to use anything to attack Fidel Castro.

The working masses of Venezuela, however, once again flooded down from the hills of the capital in response to the attack from the right. The first thing they demanded was to see Chávez to check if he had, in fact, resigned. His resignation was constantly broadcast on the TV and in the press but was later denied by Chávez himself. Then, using the telephones and the “motorcyclists” (messengers on motorcycles), working people organised themselves to march on the barracks in Caracas, and other cities, and demanded that the soldiers intervene to stop the break with the “constitutional order.”

This heroic action, by an unarmed people, in surrounding the barracks had an important effect in raising the confidence and morale of the soldiers to stand up to some of the high-ranking officers. Through this action, they took control of the Presidential Palace and other important government buildings, which resulted in the negotiations that allowed Chávez to be rescued. When Chávez arrived at the Presidential Palace from an island where he had been held only hours beforehand, he was greeted by a mass demonstration of the people.

The return of Chávez as a self-declared “conciliator”, who called for “peace” and “unity”, gave room for a new right wing conspiracy. He pardoned the petrol “technocracy” and gave them the opportunity to continue their conspiring. Between December 2002 and February 2003, the right wing organised a “petrol strike”.

However, neither the national petrol “strikes”, nor the following attempts to destabilise the government, including the recent attack involving Colombian paramilitaries, have convinced Chávez of the need to decisively break from the policy of trying to ‘neutralise’ (by giving them small economic concessions) the dominant economic groups. This must now be the task undertaken by the people who have kept Chávez in the Presidency. This is the force that can carry through the revolutionary changes that the people need to make if they want to struggle against the existing unsustainable system – capitalism – which today rules the world.

Post-coup movement

From the moment of the defeat of the coup, a movement developed to defend the conquests that had been won under the Chávez government. Working people began to organise themselves at every level. New organisations in the poor communities were established (although not on a massive scale), and amongst the students (mainly in the universities). All of these organisations began to co-ordinate the work they undertook in the local communities.

These new organisations were the spontaneous response which the workers and youth had made to the continuous attacks by the right wing opposition. They are ‘unwanted children’ of the attacks undertaken by the reactionary forces.

The main objective of the armed Colombian paramilitaries was to carry out terrorist attacks and to plunge different parts of the country into chaos, with the ultimate aim of assassinating Chávez. The same Venezuelan employers and oligarchs that supported this plan also proclaim themselves fervent “patriots”, without moving a muscle on their face.

The recall referendum

The most important thing to note about the ‘recall referendum’ is that it is being called on the basis of a massive fraud organised by the opposition, who are always portraying themselves as the democrats. They used the signatures of more than 11,000 people who died more than a decade ago! “Until the last moment they were dragging out the dead,” as Chávez jokingly said on television on 9 June.

However, workers and the poorest sections of the population, who in principle opposed the referendum, now see this as a ‘chance’ to ratify Chávez as the President and as a means of developing the social changes that have benefited them.

The employers and the oligarchs are already playing all the cards they have in their hands to win the referendum. One of the first manoeuvres of the opposition has been to try and destabilise the food supply and basic goods. Through this, they hope to provoke a climate of dissatisfaction and confusion amongst the workers, and in this way to minimise the resistance to their campaign.

The government is attempting to counter these types of manoeuvres. For example they have announced the importation of 100,000 cows from Brazil this year. Of these, 979 will be distributed by Chávez to the small producers and, through this, to increase the production of milk. At the moment, however, the cows are not in the hands of the poor peasants. This allows the oligarchs to interrupt the production of milk and meat with a view to causing further hunger.

Judging by the mood of the masses in the streets, and in the local areas, the opposition does not have any chance of winning the referendum and they will face another defeat – the eighth since Chávez was elected into power. The most they can hope for is to mobilise a level of support during the ‘recall’ campaign from which they will prepare another attempted coup against the working class.

Given this, it is possible that the opposition will withdraw from the referendum, giving thousands of excuses, including claiming that Chávez has organised a fraud by demanding that people present official modern papers and that the voting is counted electronically.

But what is clear is that the opposition has no possibility of winning the referendum and this will not be due to a fraud. If the ‘recall’ is lost by a big majority it will leave the reactionary opposition in a weakened state before the municipal and state elections, which will be held at the end of September.

At the same time, however, the masses had not formed strong permanent organisations up to the coup in April 2002, and even following it those formed were not generalised and well-established. The overwhelming majority of working people come onto the streets only when summoned by the government or when they believed that it was necessary, such as at the time of the attempted coup.

Unfortunately, the masses still place too much confidence in Chávez, although much less in the MVR (Movimiento Quinta Republica – the umbrella of government political parties). Included in this alliance are parties whose old leaders attacked the working class for decades and that clearly play the role of a break on the movement that is now demanding more profound social changes (although Chávez does not want to go beyond the limits of capitalism).

The Chávez government is too personalised and paternalist. Chávez is “the only one” that knows what the people want and, as a military man, Chávez likes to give orders that are generally only discussed amongst the “chiefs” before they are issued.

Unfortunately, the mass of workers still do not decide the main issues and have not consciously taken destiny into their own hands. They are still waiting for the solutions to come from above.

The Popular Movement’s conclusions

Unfortunately, it needs to be said that some so-called Marxists, “professors of Marxism”, who think they are the only ones who know what to do, sit very comfortably with people like Chávez. They hold back some of the most advanced layers from drawing revolutionary conclusions and have dedicated themselves to building up the figure of Chávez. They do not put forward any criticism of his policies or of his government, and can even end up supporting the more reactionary sectors of the MVR.

Obviously, Venezuela is in a revolutionary process but to speak of a complete revolution is wrong. There have not been fundamental changes in the structures of the bourgeois (capitalist) state.

The parties that Chávez criticises today were those that previously, when in power, acted in a unilateral manner, without taking into account the active participation of working people and the poor in decision making. Today, Chávez plays a similar role as the “Compatriot President”.

Given the use of the word “revolution” by Chávez, and by the movement in general, it has been stripped of its content. Everybody is “revolutionary” in Venezuela – even the most right-wing sectors of the MVR!

Luckily, there are already workers and youth that have begun to understand that within the limits of capitalism there does not exist any possibility of maintaining the conquests already won, let alone the prospect of winning even more profound social changes.

Some workers are already tired of trying to reach agreement with the opposition. They say: “We cannot continue living like this. We do not understand the reasons for continuing attempts to conciliate with them [the bosses’ opposition] and giving them explanations. Now is the time to give them the bullet.”

Enough of negotiations and of class conciliation! This should be the central slogan of the workers and the popular movement as a whole.

If Venezuela does not advance towards the socialist revolution it will inevitably leave the doors open to capitalist reaction.

Until now, the capitalists have been the principal enemies of the revolutionary process. They are the ones who best understand where the current road could lead to. For this reason, they have attempted everything possible to crush the Chávez regime, including the organisation of a failed military coup. The problem for them is that up until now they have failed.

Time for revolutionary militias

The workers need now to begin seriously the formation of popular, revolutionary militias of working people. Not a symbolic but an armed force. The Chilean workers formed militias in their workplaces but were armed only with sticks instead of guns. This, alongside the lack of a decisive socialist programme, led to the bloody defeat of the working class and the ‘Popular Unity’ (UP) government in 1973.

The leaders of the UP said that the workers should not worry because the government had arms that would be distributed when the time was right. Everybody waited for the arms to defend the revolution against reaction, but they never were distributed.

After the Pinochet coup, thousands of Chilean workers were killed and hundreds of thousands were imprisoned and tortured. The Chilean right wing showed all its accumulated class hatred when they faced the unarmed workers.

The task of Marxists

Whatever concession is made by Chávez and his aides to the reactionary opposition will be converted into a betrayal of the movement. What is needed is to patiently explain how to defend the interests of the working class and the poor.

The first task is to support the most politically advanced sectors in drawing all the conclusions that their instincts are leading them towards. It is necessary to explain that workers need to build their own independent, revolutionary, socialist party.

It is necessary to arm the workers with a class programme that clearly raises the need to build a new society that is more than ‘just’ and ‘democratic’ – a socialist society.

The working class needs to strengthen its own organisations to confront the threat now facing the revolution. The Bolivarian Committees need to be expanded urgently, to include elected delegates from all workplaces and local communities. All these representatives should be elected by local assemblies and subject to immediate recall by the workers who elected them. The rank and file of the army needs to elect soldiers’ committees and elect officers, to begin the task of removing all the officers who support the forces of reaction. These committees need to link up on a district, city-wide, regional, and national level. They should form the basis of a new government of the workers and poor peasants. The big industrial companies, the banks and the financial institutions (both national and multi-national) need to be nationalised under a system of democratic workers’ control and management. An emergency plan of production needs to be drawn up.

In short, it is necessary to arm the working class with a class programme that clearly poses the need for a new socialist society. This is the overwhelming conclusion to be drawn from the history of Venezuela – a history of extreme class exploitation and capitalist misuse of rich natural resources – and from process of revolution and counter-revolution, now reaching a critical point, during the Chávez years.

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June 2004