Details Created: Thursday, 18 February 2016 11:57 Written by Sam Mcgill

On 6 December 2015, the Bolivarian revolution suffered its greatest ever electoral defeat, losing 56% of the vote to the right-wing Roundtable of Democratic Unity (MUD) coalition. Over the last 17 years of socialist rule, the poverty index in Venezuela has dropped from 21% to 5.4% in 2015 – a record low. More than 36,000 people were lifted out of poverty in 2014 alone, despite an economic slowdown caused by economic sabotage and falling oil prices. 84% of retired people now receive pensions; free health care and education cover the whole population. A million units of social housing have been constructed. Now these extraordinary gains for the working class are under threat. Sam McGill reports.

Counter-revolutionaries get to work

On 5 January 2016 the right-wing opposition took control of the National Assembly for the first time in 17 years. Its 109 seats, along with three pro-opposition indigenous representatives gave it a two-thirds ‘super-majority’ over Chavista forces, who had won only 55 seats. A two-thirds majority enables the right-wing to block spending on Venezuela’s extensive social missions, impose or remove ministers, dismiss the vice-president, call a constituent assembly to rewrite the constitution and initiate a process to remove President Nicolas Maduro.

However, that majority was called into question by the fact that three of MUD’s representatives, from the state of Amazonas, have been suspended pending an inquiry into allegations of electoral fraud. Nonetheless, the new President of the National Assembly – the right-wing leader of Accion Democratica, Henry Ramos Allup – went ahead and swore the deputies in. He also ordered the removal of pictures of Hugo Chavez and independence leader Simon Bolivar from the chamber. In response, the deputies of the PSUV and its allies walked out, joining mass pro-Chavista protests on the streets outside.

The three disputed politicians were forced to withdraw after the Supreme Court threatened to void any decisions made by the new assembly. Nonetheless, the MUD has not lost any time presenting an amnesty law for Leopoldo Lopez and ‘political prisoners’, many of whom have been convicted for their part in the violent protests orchestrated by the opposition since 2014, which have resulted in deaths and the destruction of public property. A law to privatise the one million homes constructed through the Great Housing Mission of Venezuela (GMVV) passed its first reading at the end of January; the law will mean the deeds to social housing being handed over to the occupants, allowing homes to be let out or sold on, turning what was a public asset into a commodity for private landlords. The legislation is being vociferously opposed by the socialist politicians. President Nicolas Maduro exclaimed: ‘Are you going to privatise the homes we have built for the people? No way! You will have to overthrow me to approve a privatisation law.’

The MUD also aims to revoke the Law of Fair Prices which subsidised food and basic necessities; privatise state enterprises and services; give foreign companies concessions and reverse expropriations. It seeks to ‘restructure’ the social missions that have provided health care and education for all and to reform working conditions, undermining the Organic Labour Law (LOTTT) which protects workers against sub-contracting and outsourcing. Allup has declared that MUD plans the removal of Maduro and key government figures within six months. The new assembly is escalating confrontation on all fronts.

How did this happen?

For 17 years, Venezuela’s Bolivarian Revolution has attempted to construct new institutions, and create popular participation and communal production in parallel to the existing private sector. GMVV social housing operates alongside a private market of expensive city apartments; the participatory democracy of the communes exists alongside a corrupt system of mayors and governors; communal economic production units and cooperative farms carve out an existence alongside huge multinationals and latifundio ranch owners. Whilst Hugo Chavez launched waves of nationalisations and expropriations, these have not significantly touched the economy outside the state oil company PDVSA. 75% of the financial sector, 92% of manufacturing and 70% of media is in private hands while the Polar multinational controls around 50% of food distribution. The capitalist class has been able to use this economic power to destabilise the whole country.

Calls for a political offensive against these private interests were made strongly within Venezuela. Researchers at the Workers’ Centre for Investigation and Formation (CIFO-ALEM) argued that: ‘The basic way to stop the bleeding of foreign exchange and the dramatic devaluation-inflation spiral is to create a Single State Importation Centre that snatches the speculative field of the parasitic speculative-importing Venezuelan bourgeoisie’. They continued: ‘[We] advocate nationalisation of the banks ... accompanied by a comprehensive policy in political economy, planning, taxes, exchange rate, credit, a Single State Importation Centre, creating a massive state industrialisation plan, improving expropriated factories and using the land to obtain economies of scale’.* Only such strong measures can decisively block economic sabotage.

The PSUV government has so far failed to take such measures, in part because of the sustained threat of civil war. Since Chavez’s death, the right-wing has launched a series of violent street protests aiming to topple the PSUV. In 2013 failed presidential candidate Henrique Capriles instructed supporters to ‘drain their rage’; in response gangs of thugs took to the streets, torching medical centres, government buildings and metro stations. In 2014, Leopolo Lopez launched the ‘exit strategy’, promoting months of street barricades and bloody violence which left 43 dead. Supporters of the socialist government have been assassinated, such as the PSUV’s youngest politician Robert Serra in 2014 and, most recently in January this year, the progressive journalist Ricardo Duran, who was the PSUV press secretary. Paramilitary forces have strengthened their presence in Venezuela, supported by networks controlled by former Colombian President Alvaro Uribe.

Meanwhile, the Bolivarian Revolution has been the target of a vicious economic war. Hoarding, speculation, smuggling, currency fraud, capital flight and systematic currency devaluation have led to soaring unofficial prices and shortages of basic goods. According to the Central Bank of Venezuela, inflation reached 141.5% in 2015 with around 60% of the rise attributable to ‘foreign exchange incidents, associated with the exaggerated depreciation of the bolivar’. Colombian banks and websites like dolartoday set the unofficial exchange rate for the bolivar from outside the country, manipulating its depreciation.

With the price of oil hovering around $30 per barrel, the economic crisis in Venezuela is set to worsen. 95% of Venezuela’s export earnings and 50% of its fiscal budget come from oil. Most of Venezuela’s oil is heavy crude, costing $20-$25 to extract. If the price of oil drops further, it may be more profitable to leave it in the ground. GDP contracted by 7.1% between September 2014 and September 2015 construction fell by 20% and commerce by 12.8%. Nevertheless, Venezuela paid off $2.6 billion of public debt in the third quarter of 2015, retaining $16.27 billion in net foreign reserves. After voting down Maduro’s emergency economic plan, the MUD will block any progressive solution to this crisis.

Following mediation brokered by the regional power, UNASUR, to end the violent opposition protests of 2014, Maduro sought to negotiate with private business owners in order to avert further bloodshed. The response of the capitalist class was to escalate hoarding and speculation, contributing to the shortages and inflation which wore down support for the PSUV in December’s elections. Negotiations continue through the newly-created national council for productive economy, a diverse commission containing representatives of powerful business lobbies and leaders, alongside union representatives, communal producers and social enterprises. The private sector, bolstered by the election result, is unlikely to compromise in the new round of negotiations.

Defending the gains of the last seventeen years will be a battle. The PSUV is a cross-class electoral party. It contains contradictory trends, some advocating socialist revolution, others aiming to develop their own national capitalism. The political crisis following the electoral defeat will force these contradictions to the fore. The collapse of oil prices and an end to limitless public spending may push the so called ‘boli-bourgeoisie’ to jump ship to further its own interests, leaving revolutionary elements to carve out a new path of resistance.

This will require the consolidation of a united socialist leadership able to direct a political movement to seize economic power. The Bolivarian Revolution’s huge advances in living conditions have not been matched by political consciousness. Because of the distortions to the economy caused by the oil industry, there is still not a widely organised and conscious working class in Venezuela. Instead increased public spending and purchasing power have promoted consumerism, with many voters receiving houses, services and state benefits without committing themselves to the political project.

Even Chavez acknowledged this phenomenon. In his autobiography, Cuentos del Aranero, he recounted how Cuba’s Fidel Castro told him: ‘I’ve come to the conclusion, Chavez. No revolution that I know of, not even the Cuban one, was able to do so much socially for its people in so short a time as the Bolivarian Revolution […] And I’ve concluded you don’t want to take political advantage of these social advances’. The Venezuelan Chavista political analyst Luis Britto Garcia makes a similar point: ‘There have not been consistent experiences in terms of training revolutionary cadres. The people have been given everything: medical attention, medicine, subsidised fuel, homes, pensions, computers for students, almost all of which is completely free. Due to the lack of an educational campaign, some believe that this all fell from the sky, and that it wasn’t the result of a lot of work nor is it necessary to defend it – that the first neoliberal demagogue who exchanges promises for votes could better it.’ (‘Ten proposals for Chavismo in the face of our defeat’ Venezuela Analysis, 17 December 2015). Socialist ideological formation will now need to be forged in resistance to the coming right-wing offensive.

All power to the communes!

The shock of the election has galvanised the grassroots. The streets have been alive with thousands of grassroots assemblies, ‘hot corners’ of discussions, communal council meetings and forums. A national communal parliament was created in December, aiming to strengthen the co-ordination of communes across the country.

A committee of 100 social movement activists and socialist legislators has been created, tasked to create a new revolutionary patriotic people’s assembly in order to discuss new forms of organisation, building a new productive economic model, diversifying methods of struggle and developing political consciousness. Evoking the call for the constituent assembly convened by Chavez in 1998 to rewrite the constitution, Maduro aims for the assembly to ‘articulate, unify, reunify and revive the strength of the movement to defend our Venezuela’. The future of the Bolivarian Revolution will now depend on its base: the communes and the communal councils, the social movements and workers organisations. The extent to which these projects are prioritised and empowered will be decisive.

The Bolivarian Revolution is faced with a major battle which demands our solidarity. Throughout its existence, it has been under constant attack from US and European imperialism; from backing the failed 2002 coup to the $40-$50 billion poured into opposition organisations annually from the US and EU, from imperialist ally Saudi Arabia flouting OPEC agreements to control oil prices to Obama declaring Venezuela a threat to US national security. The US and European powers have a long and bloody history of intervention in South America, supporting military regimes and coups alongside media manipulation, economic intervention and diplomatic interference. Their aim is to erode international support for socialism in Venezuela whilst dismantling the revolution piece by piece. Our role, as communists in an imperialist country must be to stand in solidarity with the Bolivarian Revolution. If it is crushed by the imperialist warmongers, it will be a setback for the movement for socialism, not just in South America, but across the globe.

* Sutherland, M (2013) and Caicedo, J (2014) cited in Helen Yaffe, ‘Venezuela: Building a Socialist Communal Economy?’ in International Critical Thought, March 2015. www.tinyurl.com/j7ar8a4

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