Gregory Wilpert – Venezuelanalysis.com

Venezuela’s presidential recall referendum was one of Latin America’s most historic electoral events of the past twenty five years. Such a statement probably sounds like an exaggeration to most northerners. However, this is the first time an elected head of state faced a recall referendum, the outcome of which could have ended a decidedly anti-neo-liberal government. Also, the vote contributes to the future direction of other progressive projects throughout the world because Chavez and his Bolivarian Project have opened the door and peoples’ eyes to the possibility of making real the dream of a progressive alternative to neo-liberal globalization. A defeat of the Chavez government would have signaled to progressive movements everywhere that entrenched domestic elites, the corporate-conservative private mass media, the forces of neo-liberal globalization, and the U.S. Empire cannot be successfully challenged—even under favorable circumstances, as is the case in Venezuela due to its oil wealth. At least, this is what a defeat should have signaled, even though many progressives, for various reasons, have their doubts about the Chavez government.

This is not to say that the Chavez government has not made mistakes, which might have given some progressives reason to doubt the progressive credentials of the government. Still, I would argue that what is happening in Venezuela is one of the most important progressive experiments of the past quarter century. So, given that, exactly what does the Chavez victory mean for Venezuela, for Latin America, and for the left?

Consequences for Venezuela

Before we can examine the consequences the Chavez victory has for Venezuela, we have to first clarify what the “Bolivarian Revolution” is really all about. The nature of Chavez’ Bolivarian Revolution seems to have four core aspects to it. First, it is redistributive, in that the government has become an instrument for distributing the country’s oil wealth towards the poor, mostly in the form of a wide variety of social programs and in the form of rural and urban land reform.

Second, the Bolivarian project is anti-neo-liberal. That is, economic policies are opposed to the tenets of free trade, privatization, state austerity, and deregulation, all of which tend to favor big business over the ordinary citizen. Instead, the Chavez government’s economic policies emphasize “endogenous development”—development that is geared towards diversifying the national economy, especially by supporting small businesses and cooperatives. Also, related to the concept of endogenous development, is an emphasis on education for the poor. Another aspect of this anti-neo-liberalism is to politically and economically integrate Latin America so that the South would be better suited to deal with the North economically and politically.

Third, the Bolivarian project emphasizes participatory democracy in addition to traditional representative democracy. The participatory aspect of the Bolivarian project has taken many different forms, whether the constitutional provision for referenda, various avenues for citizen participation in the naming of government officials such as judges, or increased local democracy.

Fourth, Chavez’ project emphasizes the inclusion of those who have traditionally been excluded, such as the poor, the indigenous, Venezuelans of African descent, and women. The measures for including these involve the above mentioned redistribution programs, combined with affirmative action measures, where the poor, women, and indigenous Venezuelans receive preferential treatment when it comes to micro-finance loans, housing, or educational programs.

Finally, more as a matter of necessity than of ideology, there is a realization within the Chavista movement that these different ideological policy orientations can best be pursued in a state that is free of corruption and inefficiency. The fight against corruption was thus one of the main goals of the Chavez government when it came to power, but has, until recently, received relatively little attention. Let us take a look now at how these programmatic aspects of the Bolivarian project will fare in this post-referendum period of the Chavez presidency.

The missions and the state

One of the main policy vehicles for instituting the redistributive aspect of the Bolivarian project have in the past year been what the government has called “missions.” These missions provide Venezuela’s poor with free community health care (“Barrio Adentro”), literacy training and primary education (“Robinson” I & II), high school completion (“Ribas”), university scholarships (“Sucre”), subsidized food markets (“Mercal”), employment training and public works (“Vuelvan Caras”), and housing (“Vivienda”), among others. It is estimated that well over half of the country’s population has benefited from these programs in one way or another. Also, polls consistently show a very high acceptance rate of 60 to 70% of these programs. Chavez’ victory in the referendum will almost certainly mean that the popular “Missions” will continue.

Early on, when these missions were first introduced about a year ago, the opposition criticized them for being unsustainable, for being poorly executed or ad hoc, and for subverting existing state structures. With regard to the first criticism, unsustainability, the argument was that the oil revenues with which these programs were being funded would close down as soon as the price of oil dropped, and that as such they could only be considered a kind of temporary “vote buying” measure. The government’s response has been that these programs, while admittedly the result unusually high oil revenues, will largely have long lasting effects, such as in the case of the educational and health programs, even if they have to be closed down in economically tighter times. That is, they represent some of the best capital investments any country can make in the fight against poverty: in health and in education.

With regard to the programs being poorly executed, this remains to be seen. However, while the argument cannot be proven at this time, the lack of consistent follow-up research and controls makes this argument at the very least plausible. Opinion surveys suggest that the community health clinics (“Barrio Adentro”) and the subsidized stores (“Mercal”) are tremendously successful, judging by their popularity and the number of people served. In other programs, where people receive scholarships for example, there are stories of individuals receiving scholarships but skipping their classes or of receiving stipends under false identities. Still, such practices should not be used as a reason to abolish the program, but to improve it.

Finally, with regard to the criticism that the missions are “ad hoc,” this is generally true, in that they are not part of Chavez’ original six-year government plan, nor were they introduced as a result of careful strategic thought as to how these missions fit into the larger framework of the government program, nor have they been properly budgeted by the legislature. In some ways the ad hoc nature can be considered a strength in that such programs show that the Chavez government is open to spontaneous ideas and will pick them up and implement them if they seem good. On the other hand, they still need to be developed more carefully, so that the missions are better integrated into an overall plan and are part of the larger state budget (currently the programs are mostly financed via a social fund that the state-owned oil company, PDVSA, provides).

This leads to a much more important area that the Chavez government will now have to address: the reconciliation of parallel state structures. That is, the missions have created state structures that for the most part operate outside of the normal structures of the ministries and other state institutions. For example, Misión Ribas (high school completion) and Misión Robinson (literacy) have been organized through the state oil company. Their organization and budget come from PDVSA and not the ministry of education, as normally should be the case. Government spokespersons have repeatedly explained that this is intentional because the state structures are so inefficient that to organize such programs through the ministries would take much more time and money. In effect, government representatives say that the existing state structures are too inefficient and too unwieldy to properly manage existing programs, let alone to institute new ones.

The creation of such parallel structures has of course been an important point of criticism for the opposition. Another line of attack is the criticism that having the oil company fund the programs directly, rather than through the state treasury, the government is circumventing the legislature’s right and obligation to approve of all public spending.

If the government wishes to avoid the duplication of personnel, expenditures, and other state related elements that this parallelism of ministries and missions involves, then it will have to find a way to reconcile the two. Running two parallel state structures is simply too expensive and makes little sense. But how to go about this?

Numerous analysts and critics of the Venezuelan state have pointed out how profoundly flawed the Venezuelan state is. The implication is that a simple reform of the state is not good enough. On the other hand, a near complete dismantling of the state would almost certainly cause a major uproar among public employees, many of whom still perform important duties for the everyday functioning of the state and who are thus in a good position to sabotage it, should the state be rebuilt against their will.

Chavez has said on several occasions, most recently during his weekly television program Aló Presidente, on August 22, that now the “Bolivarian Revolution” has to organize the “revolution within the revolution.” Exactly what this means is not always clear, but he did point out that one of the first tasks is to fight corruption and to “create a new state.” Like much in the Bolivarian Revolution, this too will probably be worked out on an ad hoc basis. While Chavez’ political program has outlined many of the basic goals of his government, the details are often vague and end up being developed through a complicated process of top-down directives, grassroots input, and much experimentation. A clearer process for developing and implementing the transformation would probably make the “Bolivarian Revolution” more efficient.

The transformation of the Venezuelan state, however, not only has to deal with an entrenched bureaucracy, career civil servants who oppose the Bolivarian Project, and vague ideas as to how to go about the transformation. It also has insufficient professionals who have the training and experience of managing large bureaucracies who also support the project. Chavez has hoped to get around this problem by appointing many high-level government officials from the military, but this has been no guarantee of success. A longer term project for ensuring decent state management by people who share the goals of the Bolivarian project has thus been the new Bolivarian University, which will train civil servants for the new state.

Neglected programs back on the front burner?

With all of the emphasis on the many different missions, it would seem that other programs of the “Bolivarian Revolution” are being forgotten or at least have been moved to the back burner, especially those involving land reform and participatory democracy. The year 2003 was a major year for the rural land reform. Following the April 2002 coup attempt and the oil industry shut-down, which ended in early 2003, the rural land reform had advanced only very slowly. Chavez decided to focus on the program and it received a major push, so that almost all of the land that has been provided to peasants during the Chavez presidency was issued in the course of 2003. Over 130,000 families benefited from over two million hectares of land during that year. The redistribution continues, but until recently had rarely been mentioned by the president.

For 2004 the plan is to provide another 100,000 families with land. Shortly after the referendum Chavez provided a badly needed push to the program, when he centered his weekly Sunday television program around the land reform. In the course of the program he told large landowners that they had better produce crops on their idle agricultural land, lest they risk being expropriated. “There can be no idle land. I say to the latifundistas [large landowners]: I prefer that we come to an accommodation,” said Chavez, adding that he would do everything to “give land to those who will work it and not to those who will keep it idle.” A week later, Chavez appointed a known hardliner to head up the national land institute, which is in charge of the land reform, thus signaling a harder line with regard to the program.

The urban land reform program, where families living in the poor barrios are to receive title to the land that they have occupied for decades in some cases, has the potential to affect a much larger proportion of the population than the rural land program. It too is moving ahead, but with little public attention placed on it. The urban land reform law, which was supposed to help in this process, appears to have fallen off the legislative agenda for the rest of 2004. Still, people who waited in line to vote in favor of Chavez often mentioned this program as one of the reasons they supported Chavez.

A third program that is in danger of being forgotten, but which touches on the heart of the participatory democracy aspect of the Bolivarian project and which could have great transformative capacity, is the institution of local public planning councils. These councils, which are modeled after the participatory budgeting experience in Porto Alegre, Brazil, are supposed to transform local governance. Many communities have already set these up, but people report dissatisfaction with their functioning. Critics such as long-time community activist and former vice-minister for local planning Roland Denis say that the law which regulates local planning councils was poorly written, so that the councils are supposed to operate on a municipality-wide level, which often is much too big. Caracas’ largest municipality, Libertador, for example, encompasses two million inhabitants; others have hundreds of thousands. More attention on this program might lead to a revision and an improvement of the law.

Finally, and closely related to the earlier issue of transforming and improving the state, the justice system needs a complete overhaul. Politics continues to play a greater role in the Venezuelan justice system than the fair and impartial administration of justice. This is a problem that has existed in Venezuela for decades and it ought to be embarrassing to the Chavez government that it has not been able to make any progress on this front since it came to power over five years ago. There have been several efforts at judicial reform during the Chavez government, but none of them seem to have been able to address or eliminate the core problem of politicization and the existence of judicial “mafias.”

Currently there are several high-profile cases, such as the charges against a mayor who appeared to support a siege of the Cuban embassy during the April 2002 coup attempt and charges of treason against the directors of an NGO (Súmate) that received funds from USAID and from the National Endowment for Democracy to help organize the recall referendum against President Chavez. While Venezuela’s private media certainly provide distorted press coverage of such cases, making them look like the only cases worth paying attention to, it certainly seems like there are political motivations behind these cases beyond the mere pursuit of justice. Another high profile example of politicization of the courts is the Supreme Court’s ruling that the military officers who were part of the April 2002 coup attempt were innocent.

The fight against patronage and corruption

The existence of patronage and politicization not only affects the judicial system, but is in the process of affecting all areas of the Venezuelan state. That is, the high conflictivity and the tendency of partisans on either side of Venezuela’s political conflict to conspire against each other at the workplace, has resulted in widespread efforts by those in power to fire those who oppose the Bolivarian project. Some might say that such firings are justified, especially if the person in question occupies a politically sensitive post or is in some way obstructing the state’s proper functioning. No doubt, in some cases this is exactly what has happened. However, there is also some anecdotal evidence that state employees have been fired merely for signing the petition requesting a presidential recall referendum.

But this issue has cut both ways, suggesting that this is not a problem specific to Chavez supporters, but a practice that is more endemic to Venezuelan culture and society. That is, there is plenty of evidence that private employers and public employers of regional governments that are in opposition control have fired employees who actively support the Chavez government.

Chavez is now faced with a dilemma with regard to creating a “new state.” On the one hand, constant conspiracies to undermine and sabotage the government from within have made loyalty and support for the government an important issue, especially in sensitive or strategic areas, such as the military and the oil industry. On the other hand, Chavez risks recreating the “fourth republic,” the 40-year pre-Chavez regime, in which patronage and clientelism was the norm and which, in the end, produced the corruption that Chavez always condemns so strongly.

There are solutions to this dilemma—some of which the Chavez government has been implementing, but only gradually. There is a top-down solution, in which the fourth branch of government, the “moral” or “citizen” power, that is, the attorney general, the public ombudsman, and the comptroller general, crack-down on corruption and illegalities of all kinds, such as politically motivated firings. But even pro-Chavez legal experts, such as former Supreme Court judge Carlos Escarrá, have said that this fourth branch of government has been extremely lax. For Escarrá, these individuals must be replaced with stronger enforcers, something that is unlikely to happen any time soon.

The second solution, which could probably be implemented much faster, is the bottom-up solution of what in Venezuela is known as “contraloria social,” or social comptroller. That is, Venezuelan law requires all documents that have to do with public administration to be made public to anyone who requests them. The places where this principle is in the process of being institutionalized are the local public planning councils that were mentioned earlier. These councils, besides planning local budgets and projects, are also ideally suited to exercise control over regional and local governments, making sure that funds are properly allocated and spent. The councils are in the process of beginning such work throughout Venezuela. These will in all likelihood be the real counter-weight to patronage and corruption in the Bolivarian Republic of Venezuela.

Continuation of Anti-neo-liberalism/Endogenous Development

The Chavez government has probably given its most consistent attention to this anti-neo-liberal aspect of the Bolivarian project. Some leftist critics might disagree, pointing out how the Chavez government has entered into numerous large-scale cooperation agreements with transnational corporations, such as with Royal Dutch/Shell for the exploitation of natural gas off of the Venezuelan coast, with ExxonMobil for the production of oil-related products, and with ChevronTexaco for the transformation of extra heavy crude into synthetic light crude. Presumably, according to the critics, Venezuela should exploit such resources on its own. However, given that Venezuela lacks the financial resources and know-how for this, it is a matter of practicality to engage into some limited joint-ventures with transnational corporations. The transfer of knowledge and of building human capital within Venezuela has been a crucial issue for the approval of such projects.

Despite these joint ventures, Venezuela is the most anti-neo-liberal government in the western hemisphere, in that it has battled the Free Trade Agreement of the Americas and the World Trade Organization more vigorously than anyone else. As a counter-weight to the power of the U.S. and of international financial institutions, Venezuela has also been actively pursuing Simon Bolívar’s dream of a unified Latin American continent. While Venezuela would like to “insert” its industries even more in the world market, it has done this not by opening its industries up to foreign takeovers, but by targeting specific industries and businesses for subsidies. Also, Venezuela’s currency exchange control has limited currency speculation and is giving the government a powerful tool to limit capital flight and tax evasion because only businesses that are up to date on their taxes receive hard currencies.

Equally important as the macro-economic policies that go against neo-liberalism is the support the government has given to small businesses and cooperatives. The Venezuelan state, which purchases tremendous quantities of goods and services every year, has been giving preference to domestic cooperatives and small businesses, significantly helping this sector. It is thus no surprise that the chamber of commerce of small industrial businesses, Fedeindustria, supports the Chavez government wholeheartedly.

No significant change has been announced in this area of government policy for the near future. However, outlines of new areas of emphasis are identifiable. First, while the government has not been pursuing a strategy of nationalizing privately held companies, as some would expect a left government to pursue, it is more likely that the government will start its own public enterprises from scratch, which will compete with the private sector. For example, the recently created state-owned airline, Conviasa, and a new state-owned telecommunications company, Covetel, are the two most recent examples of this type of effort. It is entirely possible that if these succeed, the government will launch more companies like this.

Other areas that will be intensified are the government’s support for cooperatives and for micro-credits. A newly created ministry for the “popular economy,” will focus on precisely these areas.

The government’s conception of endogenous development is another aspect that will be carried forward. Chavez has repeatedly said that endogenous development is the development concept that his government will apply in Venezuela. The basic idea is that development should be something that the people of a community bring about themselves, using their own resources and capabilities, rather than something that is brought about from outside the community, as is the case with neo-liberal conceptions of development. Already the Chavez government has created hundreds of “Endogenous Development Nucleuses,” which are areas where the government has promised to help communities find ways to take advantage of their local resources so as to become more self-sufficient and at the same time more “developed.”

Consequences for Latin America

By continuing and in some cases deepening the Bolivarian project in the areas mentioned above, Chavez’ victory in the August 15 recall referendum means that it will continue to show the way for a possible progressive development path in Latin America. Over and over again governments are elected in Latin America only to end up breaking their promises and following the neo-liberal model of development. Perhaps the most outrageous example of this has been the Lula government’s recent offer to auction off billions of barrels of Brazilian oil reserves.

Chavez, by being one of the very few leaders to stick to his promise to pursue a different development path, has begun to function as an example for progressive social movements throughout Latin America. Also central to any alternative development project is the challenge Chavez presents to U.S. hegemony in the world. As a result, Chavez’ popularity has been growing recently in all of Latin America. Observers in different Latin American countries have reported that presidents such as Ricardo Lagos of Chile have gone out of their way to appear in public together with Chavez, in the hope that some of his popularity might rub off on them.

Despite this growing popularity, individuals and organizations involved in the World Social Forum are often still skeptical of the Chavez government or of any government for that matter, a product of their “change the world without taking power”-approach to politics. Their general idea is to create individual, small scale, and local transformations that would eventually add up to changing the world, without the help or participation of governments.

However, as the writer Tariq Ali said in a recent interview on Venezuela, those who believe in this approach have to realize that “in order to change the world you have to take power, and you have to begin to implement change—in small doses if necessary—but you have to do it. Without it nothing will change.” This may be an overstatement, since, from a sociological point-of-view, social structures can indeed change if enough individuals who support these structures change. On the other hand, individuals who live in marginalization, poverty, and deprivation are not in a good position to change the world, unless the proverbial boot that is on their neck is removed first. All too often this “boot” takes the form of poverty, the U.S. government, of transnational corporations, of the International Monetary Fund, or of anonymous speculators.

That is, while individuals and their communities indeed have to change in order to change the world, states also have to give them the space and the opportunities to do so. This is precisely what is happening in Venezuela today. As such, the Venezuelan example should and will continue to inspire movements across Latin America. And this is what makes Chavez victory in the recall referendum such an historical event.