Imperialism Retreats in Venezuela

By Rod Holt

Two weeks before the massive demonstration in New York City (the 28th) and the strategic victory for al-Sadr and the insurgents in Iraq (the 27th), the masses of Venezuela handed Hugo Chavez a resounding endorsement by defeating his opposition’s effort to recall him as president. It is a tribute to the strange detachment of the American political charade that during the Republican National Convention no note was made of the meaning of these events. Everything went along as though nothing had happened.

United States imperialism took it on the chin the morning of August 16 when Hugo Chavez delivered his acceptance speech after his presidency was assured until the elections of 2006. Chavez is not a favorite in Washington. Ever since his election in 1999, he has asserted the independence of Venezuela, presented the country with a new reformist constitution promoting grass root democracy, instituted social programs for the poor (over 50 percent of the people), forced the decadent oligarchy to pay their taxes, passed a new law regulating foreign oil companies in Venezuela and declared a land reform measure that forces the landfundistas (large, semi-feudal landowners) to prove that they own their ranches, and not only that, but that the land is actually used. Otherwise the land is expropriated. This applies to over 45 million acres of meadows and grasslands held by a handful of arrogant grandees. And to the dismay of the State Department Chavez warmly welcomed a visit from Fidel Castro who he proudly calls a friend.

The official hostility to Chavez can be seen in John Kerry’s statement on his web site:

This is close to a declaration of war. Kerry continued: “He must be pressured to comply with the agreements he made with the OAS and the Carter Center to allow the referendum to proceed, respect the exercise of free expression, and release political prisoners.” To please Kerry, Chavez must allow a democratic recall referendum with American observers. And guess what has happened.

Independently of Kerry’s bellicose declarations and following rigorously the provisions of the constitution, a referendum was held, complete with American observers and Chavez won hands down getting 59 percent of the vote. Can we expect an apology from Kerry? It is not likely and there will be no apology from the Wall Street Journal either. In an editorial of August 26, they stated:

Taking care of business

When it comes to business, the imperialists retire to the back pages and make as little noise as possible. According to the Dow-Jones Newswires, well before the referendum Venezuelan bonds looked better than ever. One prominent bond analyst was recommending them, saying, “…we do not believe the outlook in the shorter term necessarily improves if Chavez is defeated.” Bloomberg News reported (August 21) astonishing economic growth in the economy. “Gross domestic product, the broadest measure of a country’s output of goods and services, grew 13.6 percent in the second quarter, the central bank said. G.D.P. expanded 35 percent in the first quarter, recovering from a 28 percent contraction in the first quarter of 2003, when a two-month nationwide strike cut oil output.”

Meanwhile, the major U.S. oil companies carried on. Months before the referendum, the U.S. based Chevron-Texaco announced its plans to invest $6 billion in a refining project and Exon Mobil plans $3 billion for a petrochemical plant. These investments are regulated by the new Hydrocarbon Law that gives Venezuela a minimum 30 percent royalty and 50 percent ownership. Since the U.S. imports about as much oil from Venezuela as it does from Saudi Arabia, the State Department will have to just grin and bear it.

Instead of making deals

How is it that Venezuela can thumb its nose at the colossus to the north? It is simple enough. The Chavez regime is populist through and through with rhetoric from Robin Hood. Of Black and Indian descent as are 80 percent of the population, Chavez has turned to his advantage the old racial prejudices of the Castilian aristocracy and their white bureaucrats.

When Chavez and those around him have been challenged, they have appealed to the masses. In the abortive coup attempt of April, 2002, Chavez was abducted by a traitorous wing of the military. Whereupon, millions of ordinary people in Caracas and all across the country threatened to tear the country apart if he wasn’t returned to power immediately. The army generals and the oligarchy could not stand up to the determined masses, and Hugo Chavez returned victorious in two days.

When his rule was challenged by the U.S.-backed opposition with a lockout by the oil company management, he explained what was really going on and asked the Venezuelan people to help fight the bosses and keep the oil company going. Although oil exports fell to a third of normal, the ports were kept open and the strikes by shopkeepers ignored. The bosses’ strike was broken by the determination of the masses to hang on until they won.

When his rule was challenged by that same opposition utilizing a constitutional provision that enabled a recall referendum, he called for a mass mobilization to register and educate voters. Over 900,000 volunteers canvassed the country, virtually assuring his victory. This type of response to the efforts of the oligarchy and the privileged to overthrow the government have been repeatedly met by millions of the poor and the workers, and the opposition cannot defeat those millions with just dollars and propaganda.

The problem for imperialism

For imperialism as a whole, the victory of Chavez spells trouble. Other Latin American countries have oil and gas too and the Venezuelan experience has shown that a vigorous populist movement might wrest control of these resources.

Chavez has proposed a “Petroamerica” cartel. “It has received the support of the government of President Lula, of Uruguay, of Paraguay,” oil minister Rafael Ramirez reports. There is an agreement with Trinidad. Bolivia and Ecuador have officially asked for support. Venezuela has provided these countries technicians, analysts and advisors.

While there is nothing explicit said about American imperialism, Ramirez’s meaning is clear when he states:

Big Oil can profitably meet the requirements of Venezuela’s Hydrocarbon Law. But if the compliant regimes in the rest of South America are swept aside and replaced by new nationalist governments seeking to renegotiate deals along the Venezuelan pattern, all imperialist profits are endangered, not just those of the oil and gas companies. The U.S. State Department thus faces a quandary: Until an alternate source is found for Venezuelan oil—and Iraqi oil must seem a distant dream—there is great risk and little to be gained in overthrowing Chavez. At the same time, losing South America to more of Chavez’s sort is suicide. Thus, American imperialism is paralyzed—for a while.