"We, and millions of people around the world … believe another world is possible, a world free from war, poverty and hunger. Here in Venezuela the [government of socialist President Hugo Chavez] along with the majority of the people in our country are fighting hard to build this new world, despite the attempts of the old elite and the US government to prevent us from succeeding." This is what 25-year-old university student Germania Fernandez told Pablo Navarrete, according to a December 1 article on Venezuelanalysis.com.
Fernandez was participating in a November 26 demonstration in Caracas of 2.5 million people, in a city of only 5 million, in support of Chavez's re-election on December 3 and his call to deepen the pro-poor revolutionary process his government is leading. Repeatedly slamming the "perverse" system of capitalism, Chavez insisted that December 3 would be a referendum on the construction of a "new socialism of the 21st century" — a "democratic" and "humanist" socialism that did not repeat the errors of the Soviet Union.
The results were spectacular. Chavez scored 7.3 million votes (63% of the total), the highest number for a presidential candidate in Venezuelan history and more than double his votes in the 2000 elections. Chavez has since declared: "All that was privatised, let it be nationalised." The nationalisation of the telecommunications firm CANTV and Electricity of Caracas, both owned by US interests and amounting to 50% of daily trading on the Caracas stock exchange, has already been carried out. Chavez has given five oil multinationals in the Orinoco Belt until May 1 to give the state-run oil company PDVSA at least 60% controlling interests in their ventures, and has promised to nationalise gas.
These radical moves build on the gains already made by the Bolivarian revolution, as the process led by Chavez, who was first elected in 1998, is known. Named after Simon Bolivar, who liberated much of South America from Spanish colonialism, the revolution has sought to challenge corporate interests and redistribute the nation's oil wealth to the poor majority. A November 17 Venezuelanlaysis.com article by Calvin Tucker points out that according to opposition-aligned polling company Datanalysis, the income of the poorest 60% has risen by 45%. Navarrette reports that a recent census reveals the number of households living in poverty has dropped from 49% in 1998 to 33.9% in early 2006.
The revolution is also thoroughly democratic. Pro-Chavez forces have won 11 straight national elections and introduced a new constitution guaranteeing popular participation in government, including the right to overturn any legislation via a national referendum. The government has announced an extension of direct democracy, via the promotion of grassroots communal councils, and is also discussing workers' councils in workplaces across the country to enable working people to exercise control over production.
'Death of history'?
"This is not supposed to be happening", you can almost hear them cry out in the corporate boardrooms. There is an air of disbelief in much of the corporate-owned media's coverage of Venezuela. After the collapse of the Soviet Union and the Eastern bloc, socialism was supposed to be dead and buried. History was supposed to have ended, with capitalism triumphant. What kind of weird, throwback retro act is playing in Caracas?
Yet no-one should be surprised. The "new world order" has brought the world fresh wars for corporate profit, worsening poverty and environmental destruction. In the 1990s, poverty greatly increased across Latin America at the same time as some 4000 publicly owned companies shifted into the hands of multinational corporations. Russian revolutionary V.I. Lenin's comment that the world was living in an "epoch of war and revolution" rings true today.
Venezuela stands at the head of a turbulent mass revolt across Latin America. In recent times, mass uprisings have deposed pro-US neoliberal governments, and a number of new governments have been elected pledging to take a new path.
However it is in Venezuela that this new wave of mass struggle has gone the furthest. As the first revolution of the 21st century, which is struggling to construct socialism, it provides many lessons about how to change the world.
Corporate interests can be challenged
Neoliberal economic policies were accompanied in the 1990s by the mantra that "there is no alternative". Corporations are too powerful to challenge, we were told. The argument goes that if you don't accept the demands of the corporations, and if you place too many restrictions on their right to make a profit, then they will simply move to another country with less restrictions, and this will cause an economic crisis.
The most important lesson from Venezuela is that another way is possible. The Chavez government has torn up the neoliberal rule book. Halting privatisations that were planned before Chavez was elected, government social spending has increased by nearly ten times since 1998. A series of pro-worker laws have been passed. The government has cracked down heavily on tax evasion, closing down a number of multinational corporations for up to 48 hours for tax violations, including McDonald's, Coca-Cola, IBM, Shell, Microsoft and Bechtel. As a result, in 2005 the government increased its tax revenue by 50%, and this directly funded an increase in the minimum wage.
The neoliberal argument insists that you should not increase the minimum wage, because this will increase unemployment. In Venezuela, the minimum wage has been repeatedly increased, and unemployment is now at the lowest level since Chavez was elected.
In an article entitled "Chavez Drives a Hard Bargain, But Big Oil's Options are Limited", the October 19 San Francisco Chronicle reported that Venezuela was forcing oil multinationals to "swallow some bitter pills". As well as a number of tax and royalty increases, last year 26 foreign oil companies were forced to shift their investments into joint ventures with PDVSA that gave the latter the majority share, altogether decreasing the holdings of the corporations by around two thirds. Two companies refused and were expelled.
The result is that far from being in crisis, Venezuela's economy has grown by an average of 12% in the last three years and poverty is decreasing. Critics of Chavez have claimed that this is simply because oil prices are high, but economic growth is significantly higher in Venezuela than in other oil producing countries, and it is only in Venezuela that there is a serious attempt to both redistribute the oil wealth to the poor and use it develop other areas of the economy in order to overcome dependency on oil revenue.
Neither are corporations fleeing the country. Venezuela has called their bluff. The concept of corporations as footloose and capable of going wherever they please to get a better profit is a myth used by pro-corporate politicians to justify giving the ultra-rich what they want. There is only a limited amount of resources and markets in the world, and there is already heavy competition among corporations for control over this finite space. Venezuela shows that for all their huff and puff, much of the time corporations will accept the conditions a government imposes on them because they would prefer to make some profit than none at all.
Popular power can win
The US government — representing the interests of US corporations — and the Venezuelan capitalist class have not taken this lying down. They launched a campaign to overthrow the government and reverse the gains of the revolution. In April 2002, the pro-capitalist Venezuelan opposition launched a military coup that overthrew Chavez and installed one of Venezuela's richest men, the head of the chamber of commerce, as president. Chavez was kidnapped and his murder planned. The US government, which knew of the coup plans in advance, openly welcomed Chavez's overthrow. However a popular uprising of the poor and loyal soldiers overthrew the coup junta in two days and restored Chavez's presidency.
The opposition tried again in December 2002, when big business organised a bosses' lockout that closed companies across Venezuela to sabotage the economy and force Chavez to resign. The pro-capitalist management of the nominally state-run PDVSA shut the company gates and sabotaged production. However, the poor mobilised again, and blue-collar oil workers in alliance with the armed forces (purged of the coup plotters) restarted PDVSA and broke the lockout.
The opposition has continued trying to overthrow Chavez and stop the revolution by any means possible. However despite all its wealth and the support and millions of dollars in funding it receives from the US government, its attempts have been defeated by the people. The presidential election was the latest crushing defeat suffered by the Venezuelan elite.
Socialism, not capitalism
One of the most crucial lessons of the Bolivarian revolution, learned from the experience of the class struggle, is that you cannot build a society based on social justice within capitalism. The capitalist system — whereby the ownership of the means of producing wealth are owned by a small minority who run the economy for profit — has to be replaced with socialism, where industry is collectively owned and democratically run by the workers.
The revolutionary movement did not start out with socialism as its goal, and many believed this was not viable in the wake of the collapse of the Stalinist system in the Soviet Union that claimed to be "socialist". Chavez initially called for a "third way" between socialism and capitalism. The aim of the revolution was to transform Venezuela, an underdeveloped nation, along pro-people lines. The original economic plans to carry this out involved a combination of the privately owned capitalist sector, the state sector and a sector known as the "social economy" — based on cooperatives and small business.
It was the actions of the capitalist class that convinced both Chavez and the majority of Venezuelans that achieving this project required breaking with capitalism. In the face of moderate pro-poor reforms that affected its interests, the capitalist class attempted to overthrow the government. It used its position to sabotage the economy to protect its privileges. The workers have responded by taking over companies left idle by their bosses and running them for the benefit of society, while it is the cooperatives established by the poor that have proven willing to develop much-needed sectors of the economy like agriculture.
The gains of the revolution have been made where the government has been able to use industries under its control, especially the oil industry, in an increasingly planned way in conjunction with the cooperatives to solve people's needs and develop the economy.
This led Chavez in 2005 to come out in favour of socialism. He argued that the struggle for a "capitalism with a human face", was just trying to "put a mask on the monster". Chavez called for a debate across Venezuelan society on the goal of socialism. On December 3, the Venezuelan people gave their answer, opening the way for further moves towards a democratically planned economy.
Power to the poor
Another key aspect of changing the world is the need to struggle for power. Neither spontaneous revolts, nor movements that purely pressure those already in power for concessions, are enough to bring about significant change.
In Venezuela, the movement Chavez led was able to win government through elections, and then begin to pass reforms that benefited the poor. However, it quickly became clear that simply winning an election is not the same thing as winning power. Power is exercised under capitalism both through the economic power in the hands of the corporations, but also through the structures of the state, including the unelected bureaucracy that controls state administration, and instruments of repression — such as the armed forces, the police and the courts. It is not enough to be able to pass laws, you need to have the power to implement the changes, and the institutions the Chavez government inherited have been dominated by forces hostile to the revolution that have sabotaged it at every turn.
In response, Chavez has turned to the people, insisting that "to eradicate poverty, you must give power to the poor". While the media is obsessed with the individual personality of Chavez, it is ordinary people across Venezuela, led by Chavez, who are making the revolution. The attempts of the capitalist class to overthrow the government have not been defeated through parliament, but through mass action on the streets.
The defeat of the coup and bosses' lockout through "people's power" changed the relationship of forces in Venezuela to enable more radical measures. After the failed coup, the government was able to purge the military of hundreds of right-wing officers, and increasingly use the armed forces as a weapon to defend, rather than repress, the people. After oil workers took over the oil industry during the bosses' lockout, the government was able to take full control of the industry and use the oil income to begin seriously redistributing wealth.
Just as important is that the institutions the Chavez government has inherited are dominated by a counter-revolutionary corrupt bureaucracy. To overcome this, the government has sought to encourage the organisation of working people into grassroots institutions of direct democracy. The social missions have been organised outside of the control of the existing institutions, and have run parallel to them under community control.
A number of experiments in creating popular power have led to the promotion of the communal councils as the building blocks of a "new revolutionary state", in Chavez's words. These are not like the sort of local councils that exist in Australia. Based on no more than 400 families, the communal councils operate according to direct democracy. A general assembly of the community is the highest decision-making body and it directly controls the funds and planning for the social missions in that area. In this way, the corrupt bureaucracy is bypassed. The government is pushing for a significant expansion in the number and the power of these councils.
This struggle is still playing out, and there is a strong bureaucracy not just within much of the state, but that has also infiltrated the pro-Chavez political camp. There are many cases where the hold of the bureaucracy means that revolutionary measures exist only on paper, and the degree by which changes have occurred is often tied to the degree by which power is able to be exercised directly by working people themselves. Chavez has called for moves to further strengthen the institutions of popular power, such as the communal councils, in order to "dismantle the bourgeois state".
For re-raising the banner of revolution in the 21st century, by showing it is possible to struggle and to win, and by providing invaluable lessons on how such a struggle can advance, all those who believe in a better world owe the Bolivarian revolution an enormous debt.