Bolivia: Morales takes on Big Oil

"The Spanish, the North Americans, the Europeans looted the tin, the silver and the natural resources. We should recognise that in 1937, under the leadership of the armed forces, petroleum was nationalised for the first time, the second nationalisation was carried out in 1969 with the intellectual Marcelo Quitoga Santa Cruz and his struggle continues today". This is a quote from the speech delivered by the Bolivian president Evo Morales on May Day 2006 when he announced the presidential decree reversing the privatisation of the oil and gas industry instituted in 1996.

Making his speech in the south-eastern department of Tarija, home to the largest of Bolivia’s gas deposits, Morales was flanked by various ministers and the armed forces. In addition the army stepped in and guarded all major installations and refineries making a strong statement to the multinationals not to try and destroy important documents and in an even stronger statement to the Bolivian ruling class that the army was with the government and it should not try to stage a coup or fuel separatist tendencies to split the country.

Everywhere huge May Day demonstrations took place. The jubilant masses were celebrating what they see as a first step to the full nationalisation of the hydrocarbons (oil and gas industry). Jose Lopez, a Santa Cruz native, expressed his joy: "For the first 100 days of his rule, Evo didn’t do the things he said he would. But this was much better. Now everyone is behind him again."

Western imperialisms’ response to "the first nationalisations of the 21st century", as the vice-president Alvaro Garcia Linera called the move, was one of condemnation. Spain’s president, the social democrat, Zapatero, threatened to cut his country’s aid budget to Bolivia. Brazil’s ‘social democratic’ president Lula said the two countries will "negotiate in the most democratic way possible" the future energy prices, but called the move "unfriendly" while the US’ Secretary of State, Condoleezza Rice, accused Morales of "demagoguery".

The ‘Movement towards Socialism’, or MAS – the party of president Evo Morales – may present the presidential Supreme Decree number 28701 as its gift to the masses, but in reality it is not theirs to give. The struggle of the Bolivian working class and poor masses with their main demand being the nationalisation of hydrocarbons – the ‘gas wars’ – has dominated the political landscape for the last four years. The mobilisations of the working class, organised in trade unions and community committees, has lead to the downfall of two governments. The MAS was largely a by-stander in the uprising of October 2003, in which more than 60 people were killed by the police and the armed forces, and the mass mobilisation of May and June of 2005. The MAS supported the government of Carlos Mesa in 2004 and early 2005.

Nationalisation or renegotiation

The biggest foreign operators in Bolivia are the Spanish-run company, Repsol, and principally Petrobras, the state-owned Brasilian giant. The Bolivian affiliate of Petrobras accounts for 24% of Bolivia’s tax receipts, 18% of its GDP. Beyond this, Petrobras itself operates 75% of the gas exports and 95% of Bolivian refining capacity. It produces 100% of the gasoline and 60 percent of the diesel oil consumed in Bolivia.

The decree passed by Evo Morales stops short, at present, of the expropriation of the multinationals. Instead it foresees that the state-run oil and gas company, the Yacimientos Petroliferos Fiscales (YPFB), all but destroyed in the privatisation process of 1996, will be resuscitated to take majority control over all the gas fields and installations. The multinationals, who have made enormous profits over the last 10 years by paying only 18% tax, will be made to pay 82% tax and have, under the new agreement proposed to them, control over only 18% of the resources which they exploit. If they do not agree to re-negotiate contracts over the next 180 days, the government has threatened to expropriate them.

Although this comes after a hundred days of rule and as a result of the growing pressure from the masses to act, it is what Morales promised in his election campaign. The masses and the working class have been demanding outright nationalisation of the hydrocarbons. The most far-sighted layers in the Bolivian trade union confederation COB demand workers’ control and workers’ management of the industry as a first step to finishing with capitalism and building a socialist society. Morales and the MAS have never committed themselves to such a course. Throughout the election campaign Morales said that he wanted to renegotiate foreign ownership of Bolivia’s natural resources. He emphasised that this would not be appropriation; it would not be nationalisation, it would be a renegotiation of contracts.

Nevertheless such is the pressure of the mass movement that Morales might be forced to nationalise completely. The first hundred days of the Morales government have seen it swinging from left to right and back again, in an attempt to try and find a balance between the interests of the masses and the appeasement of Brazilian, Spanish and British imperialism. One of the characteristic approaches of the Morales government and the MAS has been to try and separate out the more radical elements in the mass movement in order to uncover a more moderate wing to work with. During his first hundred days in office Morales and his government has repressed the mobilisations of striking airline workers and their supporters in the city of Cochabamba and reneged on a promise to increase the minimum wage by between 50 and 100%.

It seems that in the last couple of weeks the social temperature has been rising again in Bolivia. One of the elements that moved Morales towards taking this measure might be the announced general strike for Thursday 4 May in the Santa Cruz region, a general strike that was called off after the announcement of the hydrocarbons decree.

Bolivia’s May Day

Hundreds of thousands of workers and poor people took part in the May Day demonstrations. A virtual general strike took place in La Paz when tens of thousands of proud workers, peasants and indigenous marchers took part in the marches. An eye-witness report says: "I walked past the Coca-cola workers in their red union jackets with Che emblazoned on the left breast pocket, factory workers, pensioners, indigenous peasant groups from the ‘altiplano’, teachers, informal workers of a thousand varieties and thousands upon thousands of disciplined marching women from various sectors, some in indigenous dress, and others in jeans and union jackets. Restaurants and shops had their shutters closed. The only people working were the street vendors".

The placards, signs and banners on the march paid homage to the international martyrs of the working class. One banner read: "Glory to the martyrs of Chicago who offered their lives for the 8-hour day"; linking this with the continuing fight in Bolivia. "Out with the looting trans-national corporations!", "Nationalisation of the hydrocarbons now!" or "Death to the ‘Cruceňo Oligarchy’!". The Cruceňo Oligarchy is the elite of Santa Cruz who have threatened to split the country and, in effect, start a civil war to protect their interests and the interests of imperialism.

The decree announced by the Bolivian government will be perceived by imperialism as a threat to their interests and welcomed by the Bolivian masses. However, the situation in Bolivia, with two thirds of the population living in absolute poverty, is crying out for a break with capitalism and for the building of a socialist society. Only by taking full control over the natural resources of the country and the leading sectors of the economy, under workers’ control and management, will it be possible to work out a democratic plan to use the rich resources and the value created by the labour of the working class for the good of the country.

The MAS leadership, however holds on to a ‘stageist’ view of the Bolivian Communist Party (PCB). The Vice-President, Alvaro Garcia Linera, believes that socialism is impossible for at least 50 to 100 years and that the country first has to traverse to a stage of "Andean-Amazonian capitalism". This is a road to disaster lies. A new "Andean-Amazonian" capitalism might lead to the implementation of some reforms for the working class to buy social peace and stability in the short term and as long as oil and gas prices are high.

A certainty is that, as is the case in Venezuela, without the working class in control, the measures will be used for the enrichment of that part of the Latin American ruling elite who, for now, is prepared to compromise in exchange for social peace. For the workers’ movement a policy of trying to seek compromise with capitalism will prove disastrous. As long as the ruling elites, nationally and internationally, are allowed to hold on to their economic and political instruments of power, they will, time and time again seek to retake the gains made by the working class and poor masses. The ruling class will take all conceivable measures, including seeking to start a civil war, to frustrate the working class and the poor masses and break their power. A compromise with the ruling class will not succeed in wiping out the devastating poverty in which the majority of Bolivians live. In El Alto, which has been at the forefront of recent struggles, seventy five per cent of the population barely survive on less than US$2 per day. Boasting the most unequal distribution of wealth in Latin America, the richest ten per cent of the population have an income one hundred and forty-three times greater than the poorest ten per cent. In rural areas the ratio is one hundred and seventy times greater!

The Bolivian masses have proved to the world that they are potentially the real masters of the situation. They decide which government stands or falls. The lack of a conscious revolutionary mass party of the working class and poor people, armed with a revolutionary socialist programme has held back the struggle of the masses in Bolivia.

The move by the Morales government to take control of the oil and gas industry is an important staging post in the struggle of the masses to transform their lives. Experience is as great a teacher in the class struggle as in life. Earlier this year the Morales government tried to co-opt into the government some of the leaders of the Fejuve – Federation of Neighbourhood Associations – that organises poor city dwellers in El Alto, La Paz’s poor neighbour. They were immediately disowned by the Fejuve because of the undemocratic methods of the government.

The masses in Bolivia will be watchful of every move the Morales government takes. During the celebrations on May 1 outside the Petrobras Gualberto Villaroel oil and gas refinery, a state worker propped up a ladder against the front wall of the refinery just beneath the blue metal letters that read PETROBRAS. The crowd looked on as the worker tried to dislodge the letters from the wall with the intention of replacing them with a placard bearing the name of the Bolivian former state oil and gas company. "Take down the placard!" someone yells from the crowd. "Throw the letters in the trash", someone else shouts. As the worker struggles to secure the banner with the name of the Bolivian company someone in the crowd observes, "No they are not going to take it down, just cover it over". This is just anecdotal evidence but gives an indication of the views of the most advanced layers. Nevertheless any attempt by the Morales government to cover up continued capitalist exploitation, under the present conditions in Bolivia, will not be accepted by the most advanced layer of the Bolivian masses.

A future break in Bolivia with capitalism and a possible alliance with Venezuela and Cuba on the basis of a democratic socialist federation in Latin America would be a huge beacon to the masses of the neo-colonial world. On the basis of a democratically planned economy these three countries would have the power to transform the living standards of their population and challenge capitalism regionally and internationally.

The biggest possible act of solidarity with the Bolivian masses is to engage in constructive debate about the need to break decisively with capitalism and start building a democratic socialist society in Bolivia as a first step towards a democratic federation of a socialist Latin America

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