Chávez in danger

Chávez has little more than four months - perhaps even less - to come up with a solution to a very d

On 5 July, Venezuelans celebrated the 197th anniversary of their Declaration of Independence from Spain.

On that day in 1811, a group of rebel criollos (those born in the Spanish colonies but of Iberian descent), gathered in the Santa Rosa Lima Chapel in Caracas to found a new Republic, the American Confederation of Venezuela.

It would take another decade of bloody warfare war before the republican rebels, famously led by Francisco Miranda and Simón Bolívar, could declare victory over their Royalist foes.

Almost two centuries on, another kind of rebel is in charge in Venezuela, a mestizo (a person of mixed race) this time round, inspired as much by his criollo ancestors’ determination to rid themselves of foreign domination, through another, more recent ideal, also partly of European “descent”: Socialism.

However, victory for Chávez’ Bolivarian Project is by no means guaranteed. If anything, it is in more danger of being derailed, both from internal rifts and external pressures, than at any other time in its ten year existence.

Later this year, on 23 November, Venezuela will hold regional and municipal elections to elect state governors in 22 of its 23 federal states, 219 members of regional parliaments, 332 mayors, 2 city mayors, and 13 city councillors. These elections will be the most decisive since Chávez came to power in 1999.

In Venezuela, regional elections always carry great weight reflecting the extensive powers of state governors. In fact, what here is called “the old geometry of power” – the territorial divisions of a decentralised system of public administration going back to colonial times – is a core axis of political and economic clientelism. This is preoccupied with the capture of shares of Venezuela’s huge oil rent for regionally and locally based family clans.

One of the central objectives of the constitutional reform project, defeated in a referendum on 2 December 2007, was precisely to lay the legal foundations for a gradual replacement of the “old” with a “new geometry of power”, designed to hand power to a parallel structure of new communal organisations.

More importantly perhaps, the November regional elections come at a time, at which the internal tensions and contradictions of the Bolivarian Project to transform Venezuela from a rentist oil state into a productive and participative developmental state are coming to a head: Chávez has little more than four months (and perhaps even less than this) to come up with a solution to a very difficult equation.

One central variable in this equation is the private business sector. On 11 June, Chávez announced a series of economic measures to revive private sector participation in long-term productive investment projects.

Stopping short of “pro-market” measures, such as a devaluation of the Bolivar and a wholesale lifting of capital controls, his olive branch included the abolition of a recently introduced tax on financial transactions, a government finance initiative for public-private investment projects and a significant flexibilisation of capital controls for imports worth up to US$50,000 by already registered companies. In addition, Chávez also announced a wide-ranging programme of subsidies for small agricultural producers.

The smirking faces of the leading members of Venezuela’s business community – mainly bankers - lined up in a neat row to face their president, said it all: They are not falling over themselves to take up the offer, and they don’t have to. Sky-high profit rates in the financial and service sectors make relatively lower and much more long-term returns from productive investment unattractive.

For more than 50 years, per capita value added in the private-dominated agricultural and manufacturing sectors has remained stagnant. Private investment in high value added activities in the country’s oil and mining sectors remains foreign controlled.

That the local business community can content itself with siphoning off quick returns from the ever increasing oil rent and with profits from the distribution of imported merchandise, is down to its multi-fold political alliances with a very large and growing middle class, itself a product of the rentist oil state and deeply embedded in the day-to-day running of the state apparatus.

These powerful alliances change political colours, ranging from the varying colours of the old oligarchic political parties to Chavista red and military olive-green, with great ease. Whichever their predominant colour, these alliances have the organisational power to threaten the government of the day with political and economic destabilization, and to demand their share of the oil rent in return for not mobilizing.

Not only do these clientelist demands fuel inflation, in a context of low productivity and large redistributive programmes to the poor classes. This behaviour is also likely to result in a serious banking crisis in the coming months. For many years now, state revenue from oil exports has been mainly deposited in private banks who, instead of channelling this into producer credits, have engaged in often unsound and, at any rate, obscure financial investment strategies. These now threaten to backfire, exposing the banking sector to serious refinancing risks.

In view of this state of affairs, another economic policy of recent Chávez governments looses much of its apparent radicalism: Many of the nationalisations carried out since early 2007 and announced with great pomp and scare in the international press, simply reversals of economically and/or socially disastrous privatizations of the 1990s. Not only did the private owners of telecommunication, electricity, cement, some strategically central foodstuff companies as well as most likely of Latin America’s largest steel plant – Ternium-Sidor – receive generous pay-offs for their troubles. More importantly, governments saddled with the kind of unproductive, yet powerful, alliances between the local business community and a large consumerist middle class, have little choice but to nationalise, if productivity performance and reasonable working conditions are a serious concern.

The second vital variable in the equation Chávez has to solve is “el bravo pueblo”. The Spanish word “bravo” means both “fierce” – as in courageous – as well as “angry”. This very aptly describes the situation: The poor and lower middle classes of Venezuela, Chávez’ traditional constituency, are both empowered by his decade-long rule as well as profoundly outraged by the inertia of the Bolivarian Project, blocked by those colourful private sector – cum – middle classes alliances, and in danger of falling prey to decades-old mechanisms of rentist corruption.

Perhaps ironically, their protest vote through abstention (rather than migration to the opposition) in the referendum on a socialist constitutional reform on 2 December 2007 was essential for its marginal defeat, and thus, for the current sense of empowerment of those very alliances.

This tension between, on the one hand, a strong determination not to give way, and a lack of orientation, organization and immediate purpose, on the other, in the rank-and-file of Chavista supporters finds its clearest expression in the travails of the foundation of a new political party in Venezuela, the United Socialist Party of Venezuela (PSUV).

Between April and May of last year, more than 5.7 million people – equivalent to 36 per cent of the national election registry and close to 80 per cent of the votes Chávez obtained in the 2006 presidential elections – inscribed themselves as “aspirants” to join the new socialist party.

This broad mass of Chavistas of very varying degrees of militancy were subsequently organised in more than 14,000 local organisations, called “battalions”, with up to 300 members. Between January and March 2008, the founding congress of the new party, constituted of close to 100,000 spokespeople and commissioners of the “battalions”, drew up the party’s constitution and elected its National Directorate.

The first signs of tension between radical grassroots groups and the “new Chavista elite” – one more of those private sector/middle class alliances mentioned above – surfaced during these elections for the National Directorate of the PSUV: Big names popularly associated with Chavista corruption did not make it.

Subsequently, these very names pushed their way into the party leadership, not by popular support, but by means of appointments “from above”. The wide-spread disaffection and outrage caused by these appointments amongst the Chavista base forced a truly democratic and bottom-up party-internal election of candidates for the regional elections scheduled for 23 November. This has produced a mix of truly popular candidates and some rather less popular candidates who were backed because of a lack of suitable rivals.

To date, the dinosaurs of the “new Chavista elite” can declare victory in terms of their control of the state apparatus, shared with other rentist alliances, and in terms of their control of government. They have not managed to take control of the newly founded socialist party.

Whether this party will manage to rebuilt popular confidence in the Bolivarian Project and a sufficient degree of determination of the “bravo pueblo” to carry it to victory in the November elections, remains to be seen.

The final variable in Chávez’ difficult equation concerns foreign relations. The recent liberation of Ingrid Betancourt, along with 15 other hostages of the FARC (Revolutionary Armed Forces of Colombia), has a profound effect on Venezuela’s negotiation powers in an international context.

The operation is the culmination of a long-standing process of infiltration of the FARC high command, carefully planned and prepared by French, Israeli and US secret services, working along-side Colombian military. Following on the assassination, death and defection of core members of the FARC high command over the past months, this operation signals the final decline of the FARC. Whatever one’s ethical views on the legitimacy of guerrilla warfare and kidnappings, the final dismantling of the FARC beyond a peasant resistance army does away with a guerrilla force that, for decades, engaged the US to the extent of limiting its immediate control of Latin American territories to the space ranging from the Northern Frontier of Mexico to the Southern Colombian boarders.

From 3 July, this is no longer the case, and Chávez’ Venezuela is very obviously on top of the list of US officials concerned with the defence of their country’s hegemony in the Southern Hemisphere. From June, after almost 60 years on standby, the Fourth US fleet has once again been reactivated and dispatched to the Caribbean Sea, sending a clear signal that has not been missed. The most persistent rumours are of plans to “do a Noriega” on Chávez, meaning a design to kidnap him to face trial in the US – for what exactly is not as yet clear.

Finally, with Ingrid Betancourt at last and thankfully escaping from capture, and only negligible Venezuelan oil exports to Europe, there is no hope for an “enlightened Europe” stepping in to offer a pragmatic helping hand.

It would be deeply unfair to blame Chávez for this state of affairs. His hero – Simón Bolívar – failed, certainly in terms of his ideal vision of a united and egalitarian Latin American continent but not because of any specific mistakes he made.

Two centuries on, Chávez has, and always had, limited options. So far, he has played his cards impressively well, if not always elegantly.

But, perhaps inevitably, by now the game is up and the cards are on the table: Today´s equivalent of the powers of reaction of the Vienna Congress of 1815 are calling in their debtors. The poor of Venezuela and their revolutionary leader are largely on their own, backed only by idealist internationalists, the poor of Latin America, and some of its lesser influential nations.

As with their ancestors, they might not make it, and today’s Simón Bolivar will find himself hauled up before the modern equivalent of the Spanish Inquisition. However long the list of mistakes committed and of confusions incurred, it is worth remembering that a failure of the Bolivarian Project will be to the detriment of ordinary people in Latin America and all around the world.

Dr Stephanie Blankenburg is Lecturer in International Political Economy in the Economics Department at the School of Oriental and Social Studies (SOAS), London. She is currently on secondment to Venezuela as an economic advisor and analyst. This article reflects her personal analysis and is unrelated to any government views or policies.

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Why Jeremy Corbyn is a new leader for the New Times

In an inspired election campaign, he confounded his detractors and showed that he was – more than any other leader – in tune with the times.

There have been two great political turning points in postwar Britain. The first was in 1945 with the election of the Attlee government. Driven by a popular wave of determination that peacetime Britain would look very different from the mass unemployment of the 1930s, and built on the foundations of the solidaristic spirit of the war, the Labour government ushered in full employment, the welfare state (including the NHS) and nationalisation of the basic industries, notably coal and the railways. It was a reforming government the like of which Britain had not previously experienced in the first half of the 20th century. The popular support enjoyed by the reforms was such that the ensuing social-democratic consensus was to last until the end of the 1970s, with Tory as well as Labour governments broadly operating within its framework.

During the 1970s, however, opposition to the social-democratic consensus grew steadily, led by the rise of the radical right, which culminated in 1979 in the election of Margaret Thatcher’s first government. In the process, the Thatcherites redefined the political debate, broadening it beyond the rather institutionalised and truncated forms that it had previously taken: they conducted a highly populist campaign that was for individualism and against collectivism; for the market and against the state; for liberty and against trade unionism; for law and order and against crime.

These ideas were dismissed by the left as just an extreme version of the same old Toryism, entirely failing to recognise their novelty and therefore the kind of threat they posed. The 1979 election, followed by Ronald Reagan’s US victory in 1980, began the neoliberal era, which remained hegemonic in Britain, and more widely in the West, for three decades. Tory and Labour governments alike operated within the terms and by the logic of neoliberalism. The only thing new about New Labour was its acquiescence in neoliberalism; even in this sense, it was not new but derivative of Thatcherism.

The financial crisis of 2007-2008 marked the beginning of the end of neoliberalism. Unlike the social-democratic consensus, which was undermined by the ideological challenge posed by Thatcherism, neoliberalism was brought to its knees not by any ideological alternative – such was the hegemonic sway of neoliberalism – but by the biggest financial crisis since 1931. This was the consequence of the fragility of a financial sector left to its own devices as a result of sweeping deregulation, and the corrupt and extreme practices that this encouraged.

The origin of the crisis lay not in the Labour government – complicit though it was in the neoliberal indulgence of the financial sector – but in the deregulation of the banking sector on both sides of the Atlantic in the 1980s. Neoliberalism limped on in the period after 2007-2008 but as real wages stagnated, recovery proved a mirage, and, with the behaviour of the bankers exposed, a deep disillusionment spread across society. During 2015-16, a populist wave of opposition to the establishment engulfed much of Europe and the United States.

Except at the extremes – Greece perhaps being the most notable example – the left was not a beneficiary: on the contrary it, too, was punished by the people in the same manner as the parties of the mainstream right were. The reason was straightforward enough. The left was tarnished with the same brush as the right: almost everywhere social-democratic parties, albeit to varying degrees, had pursued neoliberal policies. Bill Clinton and Tony Blair became – and presented themselves as – leaders of neoliberalism and as enthusiastic advocates of a strategy of hyper-globalisation, which resulted in growing inequality. In this fundamental respect these parties were more or less ­indistinguishable from the right.

***

The first signs of open revolt against New Labour – the representatives and evangelists of neoliberal ideas in the Labour Party – came in the aftermath of the 2015 ­election and the entirely unpredicted and overwhelming victory of Jeremy Corbyn in the leadership election. Something was happening. Yet much of the left, along with the media, summarily dismissed it as a revival of far-left entryism; that these were for the most part no more than a bunch of Trots. There is a powerful, often overwhelming, tendency to see new phenomena in terms of the past. The new and unfamiliar is much more difficult to understand than the old and familiar: it requires serious intellectual effort and an open and inquiring mind. The left is not alone in this syndrome. The right condemned the 2017 Labour Party manifesto as a replica of Labour’s 1983 manifesto. They couldn’t have been more wrong.

That Corbyn had been a veteran of the far left for so long lent credence to the idea that he was merely a retread of a failed past: there was nothing new about him. In a brilliant election campaign, Corbyn not only gave the lie to this but also demonstrated that he, far more than any of the other party leaders, was in tune with the times, the candidate of modernity.

Crises, great turning points, new conjunctures, new forms of consciousness are by definition incubators of the new. That is one of the great sources of their fascination. We can now see the line of linkage between the thousands of young people who gave Corbyn his overwhelming victory in the leadership election in 2015 and the millions of young people who were enthused by his general election campaign in 2017. It is no accident that it was the young rather than the middle-aged or the seniors who were in the vanguard: the young are the bearers and products of the new, they are the lightning conductors of change. Their elders, by contrast, are steeped in old ways of thinking and doing, having lived through and internalised the values and norms of neoliberalism for more than 30 years.

Yet there is another, rather more important aspect to how we identify the new, namely the way we see politics and how politics is conceived. Electoral politics is a highly institutionalised and tribal activity. There have been, as I argued earlier, two great turning points in postwar politics: the social-democratic era ushered in by the 1945 Labour government and the neoliberal era launched by the Tory government in 1979.

The average Tory MP or activist, no doubt, would interpret history primarily in terms of Tory and Labour governments; Labour MPs and activists would do similarly. But this is a superficial reading of politics based on party labels which ignores the deeper forces that shape different eras, generate crises and result in new paradigms.

Alas, most political journalists and columnists are afflicted with the same inability to distinguish the wood (an understanding of the deeper historical forces at work) from the trees (the day-to-day manoeuvring of parties and politicians). In normal times, this may not be so important, because life continues for the most part as before, but at moments of great paradigmatic change it is absolutely critical.

If the political journalists, and indeed the PLP, had understood the deeper forces and profound changes now at work, they would never have failed en masse to rise above the banal and predictable in their assessment of Corbyn. Something deep, indeed, is happening. A historical era – namely, that of neoliberalism – is in its death throes. All the old assumptions can no longer be assumed. We are in new territory: we haven’t been here before. The smart suits long preferred by New Labour wannabes are no longer a symbol of success and ambition but of alienation from, and rejection of, those who have been left behind; who, from being ignored and dismissed, are in the process of moving to the centre of the political stage.

Corbyn, you may recall, was instantly rejected and ridiculed for his sartorial style, and yet we can now see that, with a little smartening, it conveys an authenticity and affinity with the times that made his style of dress more or less immune from criticism during the general election campaign. Yet fashion is only a way to illustrate a much deeper point.

The end of neoliberalism, once so hegemonic, so commanding, is turning Britain on its head. That is why – extraordinary when you think about it – all the attempts by the right to dismiss Corbyn as a far-left extremist failed miserably, even proved counterproductive, because that was not how people saw him, not how they heard him. He was speaking a language and voicing concerns that a broad cross-section of the public could understand and identify with.

***

The reason a large majority of the PLP was opposed to Corbyn, desperate to be rid of him, was because they were still living in the neoliberal era, still slaves to its ideology, still in thrall to its logic. They knew no other way of thinking or political being. They accused Corbyn of being out of time when in fact it was most of the PLP – not to mention the likes of Mandelson and Blair – who were still imprisoned in an earlier historical era. The end of neoliberalism marks the death of New Labour. In contrast, Corbyn is aligned with the world as it is rather than as it was. What a wonderful irony.

Corbyn’s success in the general election requires us to revisit some of the assumptions that have underpinned much political commentary over the past several years. The turmoil in Labour ranks and the ridiculing of Corbyn persuaded many, including on the left, that Labour stood on the edge of the abyss and that the Tories would continue to dominate for long into the future. With Corbyn having seized the political initiative, the Tories are now cast in a new light. With Labour in the process of burying its New Labour legacy and addressing a very new conjuncture, then the end of neoliberalism poses a much more serious challenge to the Tories than it does the Labour Party.

The Cameron/Osborne leadership was still very much of a neoliberal frame of mind, not least in their emphasis on austerity. It would appear that, in the light of the new popular mood, the government will now be forced to abandon austerity. Theresa May, on taking office, talked about a return to One Nation Toryism and the need to help the worst-off, but that has never moved beyond rhetoric: now she is dead in the water.

Meanwhile, the Tories are in fast retreat over Brexit. They held a referendum over the EU for narrowly party reasons which, from a national point of view, was entirely unnecessary. As a result of the Brexit vote, the Cameron leadership was forced to resign and the Brexiteers took de facto command. But now, after the election, the Tories are in headlong retreat from anything like a “hard Brexit”. In short, they have utterly lost control of the political agenda and are being driven by events. Above all, they are frightened of another election from which Corbyn is likely to emerge as leader with a political agenda that will owe nothing to neoliberalism.

Apart from Corbyn’s extraordinary emergence as a leader who understands – and is entirely comfortable with – the imperatives of the new conjuncture and the need for a new political paradigm, the key to Labour’s transformed position in the eyes of the public was its 2017 manifesto, arguably its best and most important since 1945. You may recall that for three decades the dominant themes were marketisation, privatisation, trickle-down economics, the wastefulness and inefficiencies of the state, the incontrovertible case for hyper-globalisation, and bankers and financiers as the New Gods.

Labour’s manifesto offered a very different vision: a fairer society, bearing down on inequality, a more redistributive tax system, the centrality of the social, proper funding of public services, nationalisation of the railways and water industry, and people as the priority rather than business and the City. The title captured the spirit – For the Many Not the Few. Or, to put in another way, After Neoliberalism. The vision is not yet the answer to the latter question, but it represents the beginnings of an answer.

Ever since the late 1970s, Labour has been on the defensive, struggling to deal with a world where the right has been hegemonic. We can now begin to glimpse a different possibility, one in which the left can begin to take ownership – at least in some degree – of a new, post-neoliberal political settlement. But we should not underestimate the enormous problems that lie in wait. The relative economic prospects for the country are far worse than they have been at any time since 1945. As we saw in the Brexit vote, the forces of conservatism, nativism, racism and imperial nostalgia remain hugely powerful. Not only has the country rejected continued membership of the European Union, but, along with the rest of the West, it is far from reconciled with the new world that is in the process of being created before our very eyes, in which the developing world will be paramount and in which China will be the global leader.

Nonetheless, to be able to entertain a sense of optimism about our own country is a novel experience after 30 years of being out in the cold. No wonder so many are feeling energised again.

This article first appeared in the 15 June 2017 issue of the New Statesman, Corbyn: revenge of the rebel

Martin Jacques is the former editor of Marxism Today. 

This article first appeared in the 15 June 2017 issue of the New Statesman, Corbyn: revenge of the rebel

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