Direct Action
Issue 7, December 2008
Marcus Pabian is a member of the Revolutionary Socialist Party and the Australia-Venezuela Solidarity Network.Despite Venezuelan President Hugo Chavez leading a popular socialist revolution in his country that has inspired millions beyond its borders, a range of people describing themselves as revolutionary socialists don’t accept that such a revolution is taking place and have declared Chavez incapable of leading such a revolution; that he is an obstacle to carrying through such a revolution.
Before examining their views, we should recall what has actually happened in Venezuela under Chavez’s leadership. On April 13, 2002, a workers’ and soldiers’ revolution won state power in Venezuela and restored Chavez as the country’s president, defeating a US-backed military coup led by Venezuela’s capitalist oligarchy and army high command that had been staged two days earlier. The coup was an attempt to stop the Chavez leadership taking control of Venezuela’s state oil company PDVSA out of the control of Venezuela’s capitalist oligarchy and the US oil corporations.
Despite the illusions Chavez had held up to then that he could pursue a “Third Way” between neoliberal capitalism and socialism, he had sought control over PDVSA in order to redirect the enormous export earnings of the company into meeting the needs of Venezuela’s workers and peasants. The coup shattered Chavez’s and his supporters’ illusions in the possibility of pursuing a “Third Way”. The political polarisation in Venezuelan society that his attempt to expropriate PDVSA provoked, culminating in the coup, also polarised the National Armed Forces of Venezuela (FAN). The top brass, drawn from wealthy families, had led the coup. But the majority of junior officers and soldiers, drawn from poor working class and peasant backgrounds, supported Chavez’s view that the country’s oil wealth should be used to meet the needs of the population as a whole, not just the capitalist elite. Rebel soldiers united with hundreds of thousands of the poor on the streets of every major city and rapidly smashed the coup regime.
In the months following the coup, the Chavez leadership purged the military of those who had supported the coup and were loyal to the interests of Venezuela’s capitalist oligarchy. This broke the core institution of the state power of the capitalist class and left the armed forces composed overwhelmingly of those who had toppled the coup out of loyalty to the fundamental interests of the working class and peasants. As a result, Chavez’s government could rely on the support of the armed forces as it confronted the economic power of the capitalist class and the old pro-capitalist civil service bureaucracy; it could now act as a working people’s government. The political revolution to transfer state power from the capitalist class to the working people had been fundamentally accomplished.
The reliability of this new state power to act in the interests of the working people was demonstrated a few months after the April revolution, when the capitalist oligarchy launched a “strike” within PDVSA. In December 2002 the top capitalist managers of PDVSA sabotaged the company, reducing oil production from 3 million barrels a day to 150,000, crippling oil income in an attempt to destabilise the revolutionary Chavez government by creating a sharp economic crisis. They were joined by 18,000 middle and lower managers and well-paid technicians. Local police forces still loyal to the capitalist oligarchy tried defending PDVSA installations against oil production workers who attempted to undo the sabotage but were quickly brushed aside by the armed forces.
Socialist revolution
By the end of January 2003 the Chavez government, relying on army officers and oil industry workers, had taken control of PDVSA, the single biggest section of the national economy. The 18,000 mangers and technicians involved in the sabotage were all sacked. Winning control of PDVSA ushered in the socialist revolution — the first step in building a socialist state that organises expropriated capitalist property into a centrally planned economy that can meet the needs of working people rather than capitalist profits.
Taking control of PDVSA transformed the reach of the Chavez government. PDVSA not only had massive revenues but its offices and staff provided the working people’s government with the equivalent of a civil service to administer government programs. The Chavez government could now bypass the resistance of the old civil service bureaucracy.
With revenue and administrative resources from PDVSA and the support of Cuba’s socialist government, enormous social gains have been made by working people — the eradication of illiteracy; a 49% reduction of those living in poverty and a 70% reduction of those living in severe poverty; a 63% reduction in unemployment; the highest minimum wage in Latin America; free education including at university and a doubling in the number of students; an expanded free health system with 10 times the number of primary health professionals and five times the number of clinics as before; improved nutrition levels through the setting up of 15,000 subsidised food markets; the planting of 33 million trees, reforesting 38,000 hectares of land. While many new public houses have been built, there are plans to end the housing shortage completely with the construction of 1.6 million new public housing units by 2016. These economic and social gains for working people demonstrate what can be achieved even in a short space of time with a socialist revolution that progressively takes charge of the economy.
Grassroots self-government is also in action and growing — the communal councils which each organise 200-400 families, number over 18,000. They bring direct democracy into daily life. They directly control their own budgets from a national fund, not local taxes.
Venezuela’s socialist revolution has expanded the centrally planned economy beyond PDVSA and the oil industry to other industries: Sidor, the largest steel mill in Latin America, the Alcasa aluminium company, the electricity companies, telecommunications company CANTV, three cement companies, and the second largest bank.
Still a ‘bourgeois state’?
Surprisingly, both the decisive turning points — the April revolution that won state power and the expropriation of PDVSA that began the socialist revolution — have been missed by a range of revolutionary socialists in the imperialist countries, leading them to conclude Chavez cannot lead the revolution they still think hasn’t begun. In September, for example, despite the expropriation of the Sidor steel mill just a few months earlier, International Viewpoint, the monthly journal of the Fourth International, an international organisation of revolutionary socialist parties, claimed that “the Venezuelan state is a bourgeois state”, i.e., that the capitalists are still the ruling class in Venezuela.
IV writer Fernando Estevan claimed that of all nationalisations by the Chavez government, none had transferred ownership from the capitalist oligarchy to the working class because the companies had been paid for and because the state power that now runs them was still “a bourgeois state”. Estevan conveniently misses the fact that PDVSA, formerly the most valuable possession of the capitalist oligarchy, was expropriated without any payment.
But there have been many other expropriations of capitalist property that have been paid for by the Chavez government. For the Fourth Internationalists, this form of nationalisation is proof that the Chavez government administers nationalised property for the capitalist class. This dogmatic conception of Estevan and his cothinkers in the FI to the real content of the nationalisations which blinds them makes them expropriations — they transfer ownership to a working people’s government, to a government that incorporates them into a plan of national production to meet the needs of working people rather than capitalist profit.
Under certain conditions, buying out the capitalists can be a form of expropriation of capitalist property by a revolutionary working people’s government. This was recognised by both Marx and Lenin. In Russia in April 1918, Lenin considered the need to expropriate, develop and centrally plan the economy as “the most difficult stages of transition” to socialism. In certain circumstances, he consider it better for a working people’s government to “buy from the bourgeoisie the land, factories, works and other means of production”, if, “the circumstances were such as to compel the capitalists to submit peacefully and to come over to socialism in a cultured and organised fashion”. Lenin observed that Marx had frequently remarked to Engels, “we could buy out the whole lot of them”.
Another measure taken by the Chavez government has also led Estevan and those who share his view to conclude that the Chavez government is not revolutionary — it encourages a transition from private capitalism to “state capitalism” to improve national production. On June 11, Chavez announced a plan to allocate $1 billion to increase production through joint ventures with capitalists in the oil, food and manufacturing industries as part of a national economic plan coordinated by the government that would target the needs of working people. This would achieve a further step towards the centrally planned economy at the heart of the socialist revolution.
Lenin, again writing in April 1918, also emphasised that a method of “compromise” and financial incentives should be used by the Russian working people’s government in order to draw capitalist business owners into forming joint ventures with the Soviet state as a step in the transition to socialism. This, Lenin argued, would allow national accounting and control of production, larger scale production, and give workers time to learn to organise such large-scale production and thus assure “the consolidation of socialism”. But those capitalists who choose not to come over to “state capitalism” peacefully were compelled to under pain of expropriation.
Similarly, the Chavez government has threatened, and carried out, expropriations of capitalist companies that reject the incentives and compromises offered and instead choose to sabotage such national production plans. A prime example is Sidor, which refused to produce steel pipes for the national plan, exporting them instead. Chavez warned Sidor’s owners in May 2007 to stop the exports or: “I would be obligated to nationalise it like I have done with CANTV”. Following Sidor’s refusal to comply, it was expropriated earlier this year by the Chavez government with the support of the Sidor workers.
Chavez also threatened the private banks in May last year. “The private bank has to give low-cost financing”, he warned, “and if they don’t want to do that then they can leave, or we will nationalise them, and I hope they understand this message.” The country’s second largest bank was nationalised this year.
Can Chavez lead the revolution?
For Estevan and those who share his views, Chavez’s call for joint ventures with capitalists aroused suspicion and surprise. In an article in the November issue of IV, he claimed the move was either “Keynesian” or “liberal”, a simple handout to the capitalists. Chavez’s actions are seen by IV’s Venezuela writer as deeply contradictory to a transition to socialism and therefore he concludes a transition to socialism would only come about if the workers become a force independent of Chavez’s decisions.
The International Marxist Tendency (IMT) led by British Trotskyist Alan Woods also concludes that the Chavez team cannot lead the transition to socialism, claiming there is an “absence of a firm proletarian revolutionary leadership armed with the scientific ideas of Marxism”. On January 11, Woods declared that Chavez lacked “the correct strategy and tactics” to make the transition to socialism because the conditions for “a victorious socialist revolution” were favourable but after “all the talk about socialism the fundamental tasks of the socialist revolution have not been carried out” by the Chavez leadership.
Woods claims both working class and capitalist forces are reflected “especially in the leadership” around Chavez, creating “constant vacillations and hesitations” by Chavez himself. Thus the IMT claim Chavez is swinging hopelessly between the demands of millions of workers, peasants and youth striving for socialism when his government does nationalise a company but then Chavez is accommodating to the influence of a pro-capitalist “right-wing” within the Bolivarian movement when he proposes joint ventures.
According to Woods, this “right-wing” favour slowing down the revolution (instead of nationalising everything immediately) and reaching agreement with the capitalist oligarchy (in joint ventures) and imperialism (joint ventures with First World corporations). Thus the IMT sees moves such as Chavez’s June 11 announcement of a fund for joint ventures between capitalist employers and the revolutionary government, not as a step toward a socialist planned economy, but as the retrograde influence over Chavez of the Bolivarian “right-wing”. Thus, in an August 2 article, Woods denounced Chavez’s June 11 call for joint ventures as the product of the Bolivarian “right-wing” of “reformists and Stalinists” trying “to create a national bourgeoisie with state money” by “throwing [pubic] money at private capitalists”.
The Bolshevik leaders of the Russian Revolution were also confronted with similar criticisms for pursuing joint ventures and “compromises” with the capitalists. As Lenin wrote in April 1918, when such joint ventures were proposed by the Bolsheviks as a means to peacefully advance the creation of a state-directed economy they infuriated the ultraleft wing of the Communists, who began “shouting hysterically, choking and shouting themselves hoarse, against the ‘compromise’ of the ‘Right Bolsheviks’.”
Instead of the method of “compromise” with the “cultured capitalists who accept state capitalism” — capitalism directed and controlled by the workers’ state — the “left Communists” declared: “The systematic use of the remaining means of production is conceivable only if a most determined policy of socialisation is pursued”. The Bolsheviks, they claimed, should not “capitulate to the bourgeoisie and its petty-bourgeois intellectualist servitors, but [act] to rout the bourgeoisie and to put down sabotage completely”.
Woods makes a similar proposal to the Russian “left-wing” Communists. He argues that it would have been possible immediately following the presidential election of 2006 for Chavez “to introduce an Enabling Act in the National Assembly to nationalise the land, the banks and the key industries under workers’ control and management”.
Contrary to Woods’ claim, Chavez has not sought a political compromise with the “national bourgeoisie”, an alliance aimed at preserving capitalism. Rather, the Chavez government is seeking economic cooperation from “the national bourgeoisie”, as Chavez pointed out in a January speech, to allow the time needed to strengthen “the people’s organisation and the people’s power” and then, “we’ll accelerate the march” to socialism.
Unlike the impatient Woods, who would like Chavez to simply decree the immediate expropriation of all capitalist businesses “under workers’ control”, Chavez understands that socialism cannot come about by government decree. It requires the prior development of the class consciousness, political organisation and acquisition of administrative skills by the working class. Thus Chavez is focussed on building the United Socialist Party of Venezuela into the mass political force necessary to carry through the transition to socialism — a mass revolutionary socialist party. On the economic plane, the Chavez leadership is following many of the steps that Lenin advocated after the Bolshevik-led workers took political power in November 1917, steps toward the building up of a workers’ centralised administration of economic resources and activity, including joint ventures with capitalists who submit peacefully to a national economic plan serving working people’s interests.
In his September IV article Estevan wrote that 12 days after Chavez’s June 11 offer to the capitalists, “when the most radical wing was wondering about the logic of such economic reforms, Chavez caught everyone on the back foot by announcing the nationalization of the sugar factory of Cumanacoa in the state of Sucre, in the framework of a plan for the development of endogenous production of sugar cane’’. Estevan added that this “nationalization followed those of CANTV (telephony) and Corpoelec (electricity) which took place in July 2007, of Sidor, the country’s principal steel-works in April 2008, [and] of the cement industry, including the French company Lafarge and the Mexican Cemex, in May 2008. Lastly, this nationalization preceded the announcement of the nationalization, in July 2008, of Banco de Venezuela, a subsidiary of the Santander group, which was the second-biggest private bank in the country, with funds of more than 500 million euros.”
Given the past record of the Chavez leadership of expropriating capitalist property, why did the Chavez government’s nationalizations of the Cumanacoa sugar factory and Banco de Venezuela catch “everyone” of the Trotskyists “on the back foot”? In his September IV article, Estevan argued that while the nationalisations carried out by the Chavez government “contribute to giving weight to the state productive and financial apparatus, to the detriment of the private sector … the Venezuelan state is a bourgeois state, with many elements of state capitalism”. If you think that Chavez heads a “bourgeois state”, a coercive apparatus that defends capitalist property and capitalist profits at the expense of the interests of the working people of Venezuela, then you will continually be caught “on the back foot” by the actions of the Chavez leadership team. If you stick to such a view, you will fail to see that they are genuinely revolutionary socialists who are consciously leading the socialist revolution in Venezuela.
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