Venezuelan President Nicholas Maduro is being challenged by an emboldened right-wing opposition as the country spirals into disaster.
Elections for a National Constituent Assembly, dominated by his party as a result of an opposition boycott, have given him a short-term reprieve.
But the immense economic, social and political crisis in Venezuela is not going away.
After Hugo Chávez was elected president in 1998, the government delivered significant improvements for workers and the poor through diverting Venezuela’s oil wealth towards health, education, and housing. But this relied on a surge in oil prices, which has now ended, throwing the economy into chaos.
Chávez failed to diversify the economy or plan to deal with a drop in oil prices. As a result a staggering 95 per cent of Venezuela’s external income comes from oil, up from 67 per cent 20 years ago.
Poverty is soaring, with inflation at 700 per cent, producing a chronic decline in workers’ purchasing power. Almost 90 per cent of the population cannot buy enough food, and there’s been an average weight loss of eight kilograms.
Research by the teachers’ union in late 2016 found that it now takes 17 minimum wage jobs to pay for a basket of basic goods and services.
The crisis has been seized on by the wealthy and the right-wing opposition who never accepted Chávez or his successor, Maduro. Their hoarding and black market trading have worsened the shortages of basic goods for ordinary people.
The opposition has staged months of large protests against Maduro, although they appear to have died down for now. Violence both from government security forces and right-wing vigilantes has killed at least 126 people since April, according to the respected Venezuela Analysis website.
Neither the government nor the opposition have any solution to the country’s crisis. Maduro’s control of the National Constituent Assembly simply sets up a stand-off between the new body and the opposition-controlled National Assembly.
Donald Trump has also weighed in, labelling Venezuela a “dictatorship”, and threatening a “military option”. He has banned US banks from new dealings with the Venezuelan state and the state-owned oil company PDVSA. The main opposition coalition, the MUD, welcomed the US sanctions.
Corruption
Widespread corruption among the Chavista state bureaucracy has bred disillusionment with the government, as officials pocket state funds for personal gain. Last year, Chávez’s ex-minister of finance, Jorge Giordani, published a statement showing that $500 billion in state revenue had disappeared.
Government institutions, like the United Socialist Party of Venezuela (PSUV) operate as instruments of patronage and political control. A new “patriotic card”, only obtainable from the PSUV, is now required to access state services, pensions, and passports.
In some Chavista areas, like Caracas’s La Vega and El Valle, the local population have driven out government ministers, and organised their own anti-government protests.
Maduro has increasingly turned to the armed forces to protect his power.
Faced with his growing authoritarianism, the failure to act over the murder of trade unionists and other grassroots leaders, and the growing violence, many previously committed Chavistas are politically paralysed.
Socialism
Venezuela’s crisis cannot be put down to the failure of “socialism”. The problem has not been too much socialism, but not enough. Venezuela’s oil wealth meant that Chávez could expand social programs without fundamentally challenging the wealth of the elite, who retain control of most of the economy. Between 1999 and 2011, the private sector’s share of economic activity increased from 65 to 71 per cent.
Under Chávez development of the Amazon was rejected for environmental reasons and in recognition of indigenous communities’ human and territorial rights. Now, Maduro has revived foreign investment in mining and forestry—centred on Venezuela’s Amazon region—as the way out of his budgetary woes. Last summer, Maduro agreed to repay multinational corporation Barrick hundreds of millions of dollars in compensation for Chávez’s mine nationalisations and granted it a ten-year tax holiday.
Real socialism would mean taking control of the wealth of the rich to address poverty and establishing mass democratic control over investment and economic planning.
It was a mass movement from below that allowed Chávez to rise to power and pushed the revolutionary process forward. In 2002 hundreds of thousands of slum dwellers in the “barrios” came out and prevented a military coup attempt. Oil workers and their allies derailed a bosses’ strike aimed at shutting down production.
The return of an independent movement of workers, together with the urban and rural poor, is going to be needed to revive any impulse towards socialism, to reject the Chavista corruption and fight the right. Without this, Venezuela’s future looks bleak.
By Mark Goudkamp
