Chavez announces radical measures against capitalism in Venezuela

At the swearing in of his new government, Hugo Chavez announced radical new measures, including an enabling law that would allow for the nationalisation of key sectors of the economy. He also explained that it is necessary to “dismantle the bourgeois state”. All this confirms what the Marxists said after the elections in December. The balance of class forces has tilted enormously in favour of the masses.

President Hugo Chavez of Venezuela during the swearing in ceremony of his new cabinet gave a fiery speech in which he announced a series of radical measures. If carried out they would be a serious blow against the power of the oligarchy and imperialism in Venezuela. The proposals he made reflect the sharp turn to the left in the country as a whole. They reflect the real mood of the masses and their desire for radical change and an end to capitalism in the country.

In December he won a massive victory, the biggest ever since the Bolivarian Revolution began. The balance of forces is now weighted very heavily in favour of the Venezuelan masses. Chavez has absolute control of parliament and massive support among the population. The conditions exist for snuffing out capitalism once and for all.

The list of measures announced by Chavez would mean striking at the very heart of Venezuelan capitalism. It is not by chance that an article that appeared in the Washington Post yesterday, commenting on his speech, appears under the title "Chavez accelerates Venezuela's socialist revolution". The title encapsulates very well what is happening in Venezuela. The serious bourgeois analysts understand what the Marxists understand. Capitalism could be eradicated in Venezuela quite easily.

In his speech Chavez emphasised that Venezuela has entered a new phase, which he defined as the "National Simon Bolivar Project of 2007-2021", which would aim to build "Bolivarian Socialism". Tomorrow, Chavez will speak again at his own swearing-in ceremony, where he says he will outline in more detail what this project will consist of, but already he has pointed to five main points, five "motors" of the revolution: a special "enabling" law, further constitutional reform, popular education, reconstruction of the organs of state power, and explosion of communal power.

The enabling law is the main plank of his proposals. It would allow Chavez, over the coming year, to push through a series of decrees. He specifically pointed out that a central part of the law would include the nationalisation of key industries that had been privatised by past governments, such as the Venezuelan telecommunications company CANTV (privatised in 1991) and the electricity industry. Earlier this year he had already threatened to nationalise CANTV if it did not adjust its pension payments to come in line with the minimum wage.

He was very clear about what needs to be done. He said, "All of that which was privatised, let it be nationalised", which received a big applause. He added that the aim was to establish "social ownership over the strategic sectors of the means of production."

He also plans to increase state control over the oil industry. At present there are four Orinoco Oil Belt projects that the state runs as joint ventures with the US companies Exxon Mobil, Conoco, and Chevron, France's Total, Britain's BP, and Norway's Statoil, but the state has a minority share in these. Now Chavez proposes taking a majority share, thus strengthening the state's control over these important projects which account for 18% of the country's oil production.

He announced that the text of the law is ready and would soon go to the National Assembly.

He also proposed new constitutional reforms. He did not specify what kind of reforms he is proposing but in his speech he said he would base himself on the "popular power, the true combustible", referring to the need to base the revolution on the grassroots, the people that have consistently supported the revolution. He added that, "We're moving toward a socialist republic of Venezuela, and that requires a deep reform of our national constitution... We're heading toward socialism, and nothing and no one can prevent it."

One specific reform he did mention was that of establishing greater control over the Central Bank. The Bank is presently independent. Chavez wants to remove this. As he pointed out, this independence makes it an instrument of "neo-liberalism". This is a correct decision. The central bank directors have systematically put up opposition to Chavez's policy of using state funds to alleviate poverty and carry out genuine reforms. They have used the independence of the bank to defend the interests of the unelected oligarchy that wishes to maintain its control over the fundamental levers of the economy.

Other measures he outlined included that of setting up a "Bolivarian popular education." He explained that this would "deepen the new values and demolish the old values of individualism, capitalism, of egotism."

He stressed the need to give a greater say in running things to the poorer areas of the country, clearly indicating the need to shift power to the masses that support the revolution. He said that what needed to be done is to "dismantle the bourgeois state" because all states "were born to prevent revolutions." This is to be done by giving more power to the newly set up Communal Councils and by developing them from the bottom up with the aim of creating a new state based on these Communal Councils.

Before his speech he had already taken a firm decision not to renew the broadcast concession to the RCTV, a TV Company that has consistently supported all the undemocratic manoeuvres to remove Chavez. It supported the 2002 coup and the sabotage of the oil industry. Chavez has been attacked for this by the Opposition and imperialism. They want the freedom to manoeuvre and plot against the democratically elected government of Venezuela. Imagine if in the USA a private TV channel supported a coup attempt to remove Bush. How would the Republicans react? That TV station would not survive one day longer.

Another measure that had already been announced, and that can be seen in the same light as the ones announced yesterday, is the removal of Vice-president Jose Vicente Rangel and his replacement by Jorge Rodriguez. Rangel had come to be seen as a representative of the most moderate elements within the Bolivarian leadership and he specifically had opposed the expropriation of the Caracas golf courses announced by the mayor Barreto at the end of August last year. At that time Rangel said the government was fully for the respect of private property.

Marxists cannot but give full-hearted supported to the measures announced by Chavez. We have consistently argued that the Venezuelan revolution cannot stop halfway. Either it moves forward to the expropriation of the commanding heights of the economy, thus breaking the power of the oligarchy and imperialism, or the process could unravel, with the oligarchy using its control of the economy to carry out acts of sabotage and wear down the revolution.

The massive victory in the December elections was a clear signal that the masses want to move on and take on the oligarchy. Chavez's speech reflects this situation. It explains why he stated that, "Nothing or no-one will be able to push us off course in our pursuit of... Venezuelan socialism, our socialism." During his speech he specifically referred to the ideals of Marx and Lenin.

The reaction of the bourgeoisie internationally has been as could be expected. Alberto Ramos writing for Goldman Sachs has commented that, "These disconcerting policy announcements represent a clear turn into deeper nationalist and interventionist policies, which can lead to further erosion of business confidence and the country's macro and institutional fundamentals." Richard La Rosa, an equities trader at Activalores Sociedad de Corretaje CA said that, "We all expected some radical announcements after his swearing-in, but this took markets completely by surprise. We never imagined that he would name a company specifically. It left all of us in shock." He added that, "The big question in the marketplace is how are we going to be compensated? No one doubts of Chavez's intentions at this point." Many are making the comment that Chavez could go down the road that Cuba took back in the early 1960s, when Castro nationalised the bulk of the economy.

Chavez is to be sworn in tomorrow as President. This will be his third term in office and would take him up to 2013. The bourgeoisie in Venezuela and internationally is mounting a rabid hate campaign against Chavez as he moves further and further to the left. This is not by accident. Their real material interests are at stake here. If Chavez goes all the way he will receive the enthusiastic support of the Venezuelan masses. In the recent period Chavez had spoken about making the revolutionary process in Venezuela "irreversible". There is only one way of doing that: expropriate the bourgeoisie and build a revolutionary state based on the working class.

When he says that it is necessary to "dismantle the bourgeois state" he is absolutely right. The present state is riddled with agents of the old regime. The big majority of civil servants and top state officials is still made up of people appointed in the past to serve the interests of the bourgeoisie. They cannot be trusted. Every day, every minute they are manoeuvring to block any progressive reform. They are trying to slow down the revolution, hoping to wear it down and prepare the ground for a return of the old regime. Chavez has often referred to bureaucratism and corruption at all levels that are blocking the revolutionary process.

What is needed is to shift the centre of action to the masses themselves. The only force that Chavez can really trust is that of the Venezuelan working class, the peasants and the poor. Now is the time for committees to be elected in all the factories and other workplaces, in the working class neighbourhoods. These should elect delegates to higher bodies, eventually leading to a national body. This would be the instrument that could "dismantle the bourgeois state" and build a "revolutionary state".

It is to be noted that one of the few companies specifically mentioned as being up for nationalisation is CANTV, where workers and former workers have been fighting for their rights and demanding nationalisation for the last few months. This will surely provide a new impetus to the struggle of workers at Sanitarios Maracay for nationalisation under workers' control.

The UNT should take the initiative of calling immediately a National Workers' Conference to discuss these measures and take concrete steps of the workers in key sectors of the economy to organise themselves the struggle for nationalisation under workers' control and pre-empt any attempt of the bosses to sabotage them or strip them of assets or valuable information. Such a Conference should also call for a national day of action of factory occupations in which the 800 companies already mentioned by Chavez a year and a half ago should be taken over and with them all strategic sectors of the economy should also be occupied by the workers.

Chavez sees the need to "deepen" the revolution. He understands that the revolution cannot stand still. It must move on. He can see that every time he tries to push the process further, the bureaucracy comes up with a thousand and one obstacles. He feels that he cannot make this state machine do what he wants. The only road is therefore to break this machine and build a new one based on the workers.

In the next few days we will provide a more in depth analysis of what is happening in Venezuela, but what is clear is that an acceleration of the whole process is taking place in Venezuela. If the Venezuelan revolution were victorious in the coming period it would be seen as a beacon by the masses of the whole of Latin America and beyond. It would usher in a new period of revolutions. That is why all genuine socialists, communists, cannot but be enthused by the new turn of events and give their full-hearted support to the revolution. The bourgeoisie is lining up internationally, using all it has, its control of the media, the economy and so on, to strike blows at the Venezuelan revolution. It is our duty in all countries to counter this with all our might.

January 9, 2007

See also:

Join us

If you want more information about joining the RCI, fill in this form. We will get back to you as soon as possible.

Read More