Chávez's U-turn on socialism

Venezuela-based economic advisor and analyst, Stephanie Blankenburg, on what could be Chávez's fight

On 2 January, a month on from his defeat in a referendum about a socialist reform of the county’s constitution, President Hugo Chávez Frías of Venezuela performed a stunning political U-turn.

In typically flamboyant style, he made a surprise call to Venezolana de Televisión, the country’s main state-owned TV channel, “to drop a ‘bombita’ (small bomb)” on an unsuspecting public: He had decided to abandon his socialist agenda “for now” in order to form stronger alliances with the country’s middle classes, its private sector and the national bourgeoisie instead.

To dispel any doubts about his seriousness in adopting this new political course, he replaced vice-president, Dr Jorge Rodríguez – the public face of his campaign for “21st century socialism” in Venezuela – with Ramón Carrizales, a military officer and technocrat, known for his good relationships with the country’s business sector.

Perhaps more significantly still, Chávez had already signed an end-of-the year amnesty for imprisoned perpetrators of a right-wing coup attempt against him in 2002.

The President’s version of events

Two days later, on his Sunday TV show “Aló Presidente” (Hallo, President), Chávez presented his fully reshuffled new cabinet and set out to explain the rationale for his action. His socialist project had been defeated, because the country had not been ready for such a radical approach.

The only democratic response was to acknowledge defeat and to adopt a more gradual and inclusive way forward. Apart from broadening alliances to bring private business and the middle classes back into the fold, this would also mean a more careful focus on mass education and communal self-organisation. Socialism had not been abandoned, but postponed, although, by the sound of things, for quite some time to come.

Chávez’ analysis of the current situation certainly has the pleasant ring of reasonableness to it. There also is little doubt, even amongst the most fervent socialists in Venezuela, that the agenda for “21st socialism”, adopted in January 2007 as abruptly as it has now been abandoned, had been rushed in with too much haste, limiting space and time for public consultation and debate of often complex issues.

Yet, the solidity of this analysis stands and falls with the correctness of its main premise – that the failure of voters to approve the constitutional reform project in the referendum of 2 December was a vote against socialism. This is much less clear.

What is clear is that the defeat of Chávez’ reform project at the polls is down to the abstention of roughly three million voters, who only a year earlier had voted for him as their president on the same socialist platform.

Compared to the December 2006 presidential elections, the opposition did not gain any votes. It seems unlikely such a substantial bloc of Chávez supporters should have been deterred merely by deficient campaigning a year after enthusiastically endorsing him.

In fact, a closer look at electoral patterns reveals a clear protest vote, not against a socialist agenda, but against corrupt administrations, at the national and the regional level.

Chavismo and the ‘oil curse’

To understand, where this protest vote came from and why it outweighed the pro-Chavez and pro-socialism vote, it helps to remember that Venezuela is defined by only one thing – oil.

For almost a century, the state has been a gigantic machine to distribute oil rent. In this context, left and right have a rather different meaning from their usual connotations.

On one side of a profound societal divide, there are those who benefit from oil from the very rich elites down to middle-rank state employees with comfortable pension arrangements.

On the other side, there are those who are excluded from a share in this bounty, the poor and the lower middle classes.

Not surprisingly, the main objective of the “insiders” is to defend and expand their share in the country’s oil wealth. Those on the outside divide into the small group with some chance of eventually making it to the inside, and the much larger group of people without any realistic chance of ever getting there.

The latter are, or used to be, core Chávez supporters: Their only hope is structural reform that dismantles the distributive rent state and replaces it by a productive developmental state. Until now, they had set their hopes on Chávez.

That these hopes have been rattled, is only marginally to do with a hasty referendum campaign, or with the people’s ideological immaturity.

On the contrary, one of the most impressive achievements of Chavismo is precisely the very high degree of political awareness and education amongst the poor.

No, the vote outcome has everything to do with the accession of many a Chavista to the rank of “insider” over the past eight years. This process has been gradual, and perhaps inevitable in a society in which institutionalised rentier-mechanisms have been endemic for decades.

But the contradiction between a radical socialist government agenda and the “Chavista elite”, bent on defending its share in the oil rent, effectively came to a head last year.

Far from being a left-wing administration, the bulk of ministerial positions in the old cabinet, as well as many governorships, remained in the hands of the “Chavista right”, or “new insiders”.

For example, the new vice-president, Ramón Carrizales, is also ex-minister of Housing, a core social policy ministry.

All through 2007, the battle between this “Chavista elite” and the “Chavista street” was fought out within government, with the so-called left-wingers, led by Jorge Rodríguez, in the minority.

It is an open secret in Venezuela that many governors, while publicly campaigning for a 'yes' vote in the referendum, used their resources to mobilise for the no-vote behind the scenes.

Equally an open secret is the sudden destabilisation of the economy through food shortages and an escalating black market dollar exchange rate which was at least allowed to linger on for longer than necessary.

A ‘soft coup’ or a return to electoral glory?

So the Chávez U-turn looks a lot less radical. For one, the new cabinet resembles its predecessor more than it differs from it. More importantly, it is not at all obvious the strategy of a shift to the “right” will help to pacify the country and stabilize the economy.

Why? Well if it is correct that the result of 2 December was essentially a protest vote by the “Chavista street” against the “Chavista elite”, then giving the latter free range is unlikely to boost Chávez with the popular base.

Yet, this popular base is all that stands between him and a ‘soft coup’ by an emboldened middle class, made up of the “Chavista elite”, the largely a-political state bureaucracy and moderate such as ex-General Raúl Baduel, a former ally and defence minister who joined the opposition ranks in November 2007.

After all, with the control over the country's state apparatus and economic resources firmly in the hands of these groups, and a weakened popular base for Chávez, perhaps unable to deliver election future victories, why would the middle classes and their allies in the new and old elites still need Chávez?

Chávez is too much of a seasoned politician not to know this. If he still has chosen this course, it is not necessarily because it is of his liking or even of his making alone. It simply reflects the real distribution of power on the ground. His most important response is not the much publicized government reshuffle, but his decision to accelerate the organisation of a Chavista mass party, the United Socialist Party of Venezuela (PSUV).

The task of getting this new mass party up to speed is an uphill one, especially with a “Chavista” government in place that has no interest in promoting such a move, and the popular base alienated.

But unless Chávez – and the PSUV – win the regional and municipal elections scheduled for November 2008, Venezuela might well have a new president before the year is out.

In charge of the unenviable task to built a mass party in a few months and to win elections by the end of the year is none other than Jorge Rodríguez.

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.

BRIAN ADCOCK FOR NEW STATESMAN
Show Hide image

Divided Britain: how the EU referendum exposed Britain’s new culture war

The EU referendum exposed a gaping fault line in our society – and it’s not between left and right.

There are streets in Hampstead, the wealthy northern suburb of London, where the pro-EU posters outnumber cars. A red “Vote Remain” in one. A “Green Yes” in another. The red, white and blue flag of the official campaign sits happily next to a poster from the left-wing campaign Another Europe Is Possible proclaiming that the world already has too many borders.

If you were looking for an equivalent street in Hull, in the north of England, you would look for a long time. In the city centre when I visited one recent morning, the only outward evidence that there was a referendum going on was the special edition of Wetherspoon News plastered on the walls of the William Wilberforce pub in Trinity Wharf. Most of the customers agreed with the message from the chain’s founder, Tim Martin: Britain was better off outside the European Union.

“Far too much Hampstead and not enough Hull” – that was the accusation levelled at the Remain campaign by Andy Burnham in the final weeks of the campaign. He wasn’t talking about geography; Remain’s voice is persuasive to residents of Newland Avenue in Hull, where I drank a latte as I eavesdropped on a couple who were fretting that “racists” would vote to take Britain out of the EU.

Rather, Burnham was talking about an idea, the “Hampstead” that occupies a special place in right-wing demonology as a haven of wealthy liberals who have the temerity to vote in the interests of the poor. The playwright and novelist Michael Frayn, in his 1963 essay on the Festival of Britain, called them “the Herbivores”:

“. . . the radical middle classes, the do-gooders; the readers of the News Chronicle, the Guardian, and the Observer; the signers of petitions; the backbone of the BBC . . . who look out from the lush pastures which are their natural station in life with eyes full of sorrow for less fortunate creatures, guiltily conscious of their advantages, though not usually ceasing to eat the grass.”

For Hampstead then, read swaths of Islington, Hackney, Brighton, Bristol, Cambridge, Edinburgh and Oxford today – all areas that were most strongly in favour of Remain and where Jeremy Corbyn is popular. But Remain never found a tone that won over the other half of Labour England; the campaign struck as duff a note among the diminishing band of pensioners on Hampstead’s remaining council estates as it did on Hull’s Orchard Park Estate.

The rift between “Hampstead and Hull”, in the sense that Andy Burnham meant it, is one that has stealthily divided Britain for years, but it has been brought into sharp focus by the debate over Europe.

Academics use various kinds of shorthand for it: the beer drinkers v the wine drinkers, or the cosmopolitans v the “left behind”. “It’s not just that [Britain] is div­ided between people who buy organic and people who buy own-brand,” says Philip Cowley, a professor of politics at Queen Mary University of London, “but between people who wouldn’t understand how anyone could buy own-brand and people who wouldn’t buy organic if you put a gun to their head.” Equating political preferences with shopping habits might sound flippant, but on 21 June the retail research company Verdict estimated that “half of Waitrose shoppers backed a Remain vote, against just over a third of Morrisons customers”.

The referendum has shown that there is another chasm in British politics, beyond left and right, beyond social conservatism v liberalism, and beyond arguments about the size of the state. The new culture war is about class, and income, and education, but also about culture, race, nationalism and optimism about the future (or lack of it). This divide explains why Ukip’s message has been seductive to former Labour voters and to Tories, and why Boris Johnson, an Old Etonian, led a campaign that purported to despise “elites” and “experts” and spoke of “wanting our country back”.

***

At the start of the campaign, the question that most accurately predicted whether you would back Remain or Leave was consistently: “Are you a graduate?” (Those who answered yes were much more likely to vote in favour of staying in the EU.) Stronger In never found a way to change that and win over those who left education at 18 or earlier. Pollsters also suggested that the much-vaunted Euroscepticism of older voters reflects generations where only one in ten people went to university.

This fissure has been growing for the best part of a decade and a half, but Britain’s first-past-the-post system, which deters newcomers and maintains entrenched parties, has provided a degree of insulation to Labour that its European cousins have lacked. Yet even here in the UK the mid-Noughties brought the brief rise of the British National Party, powered by voter defections from Labour in its strongholds in east London and Yorkshire, as well as the election of the Greens’ first MP on the back of progressive disillusionment with the governments of Tony Blair and Gordon Brown.

In office, both Blair and Brown calculated, wrongly, that Labour’s core vote had “nowhere else to go”. In opposition under Ed Miliband, the party calculated, again wrongly, that discontent with immigration, and the rise of Ukip powered by that discontent, was a problem for the Conservative Party alone.

In a 2014 pamphlet for the Fabian Society, ­Revolt on the Left, the activist Marcus Roberts, the academic Rob Ford and the analyst Ian Warren warned that Labour had “few reasons to cheer about the Ukip insurgency and plenty to worry about”. When the votes were cast in the general election the following year, that prediction turned out to be dispiritingly accurate. Defections from Labour to Ukip led to Labour losing seats to the Conservatives in Gower, Southampton Itchen, Telford and Plymouth Moor View.

For the most part, however, first-past-the-post papered over the cracks in Labour’s broad coalition: cracks that, in the harsh light of the EU referendum, have become obvious. The divide isn’t simply one of class, or income. The social profile and culture of voters in Cumbria are no different from that of voters on the other side of the border – but Scots in the Borders backed a Remain vote while their English peers in the border areas opted for Brexit. Inhospitality towards Brexit proved a stronger indication of city status than a mere cathedral: Vote Leave generally found Britain’s great cities more difficult terrain than the surrounding towns and countryside.

The problem of the fracturing vote is particularly acute for the Labour Party, which for much of the 20th century was able to rely on the Herbivores. In concert with Frayn’s “less fortunate creatures”, they have been enough to guarantee Labour close to 250 seats in the House of Commons and roughly one-third of the popular vote, even in difficult years. But Britain’s EU referendum placed Hampstead and Hull on opposing sides for the first time in modern British political history.

It was Tony Blair who, in his final speech to the Trades Union Congress as Labour leader in September 2006, said that the new debate in politics was not left against right, but “open v closed” – openness to immigration, to diversity, to the idea of Europe. Driven by their commitment to openness, Blair’s outriders dreamed of reshaping Labour as a mirror of the US Democrats – though, ironically, it was Ed Miliband, who repudiated much of Blair’s approach and politics, who achieved this.

At the 2015 election Labour’s coalition was drawn from the young, ethnic minorities and the well educated: the groups that powered Barack Obama’s two election wins in 2008 and 2012. The party was repudiated in the Midlands, went backwards in Wales and was all but wiped out in the east of England. (Scotland was another matter altogether.) Its best results came in Britain’s big cities and university towns.

The Remain campaign gave Labour a glimpse of how Miliband’s manifesto might have fared without the reassuring imprimatur of a red rosette. Britain Stronger In Europe has been rejected in the Midlands and struggled in the east of England. But it also failed to inspire passion in Sunderland, Oldham and Hull – all areas that, for now, return Labour MPs.

***

In appearance, Hull’s city centre is built on blood and sandstone, dotted with memorials to a lost empire and postwar replacements for bombed buildings, all ringed by suburban housing built by the private sector in the 1930s and the state in the 1950s and 1960s. It could be Bristol without the excessive hills, or a smaller Glasgow with a different accent. Unlike in Glasgow or Bristol, however, the residents of Hull are largely hostile to the European Union. Unlike Glasgow and Bristol, Hull is a post-imperial city that has yet to experience a post-colonial second act.

The William Wilberforce is named after a native son who helped destroy the British slave trade, the engine of Hull’s prosperity in the 18th century. The destruction of another local industry – fishing – drives resentment among the pub’s ageing clientele, who were there for breakfast and a bit of company when I visited. They blame its demise squarely on the EU.

Although the Labour Party now has only one MP in Scotland, the back rooms of the labour movement host an outsized Scottish contingent. For that reason – and the continuing threat that the loss of Labour’s seats in Scotland poses to the party’s chances of winning a majority at Westminster – the Scottish independence referendum of 2014 loomed large for Labour throughout the EU campaign.

From the outset, Britain Stronger In struggled to replicate the success of the Scottish No campaign, in part because the price of victory was one that Labour regarded as too high to pay a second time. In Glasgow, in the week before the Scottish referendum, everyone knew where Labour stood on independence – consequently, many voters were already planning to take revenge. The proprietor of one café told me that Labour was “finished in this city, for ever”.

Predictions of this sort were thin on the ground in Hull. Alan Johnson, the head of Labour’s EU campaign, is one of the three Labour MPs whom Hull sent to Westminster in 2015. But even late in the campaign, in his own constituency, I found uncertainty about the party’s official position on the referendum. For that reason, if nothing else, it didn’t have the feeling of a city preparing to break with a half-century-plus of Labour rule, as Glasgow did in 2014. In Scotland, most people I spoke to believed that they were on the brink of independence, which made the eventual result a big blow.

Only among Hull’s pro-European minority could I find any conviction that Britain might actually leave the EU. In September 2014 Kenneth Clarke remarked that Ukip’s supporters were “largely . . . the disappointed elderly, the grumpy old men, people who’ve had a bit of a hard time in life”. To listen to Hull’s Leave voters is to hear tales of the same frustrated potential: they feel that politicians of all stripes have lives entirely removed from theirs. In their defence, they are right – just 4 per cent of MPs in 2010 were from working-class backgrounds.

As for Ken Clarke, he has carved out a second career as every left-winger’s favourite Tory, but that tone of indifference towards the “disappointed lives” of globalisation’s casualties recalls his younger days as a rising star of Margaret Thatcher’s government.

Hull’s residents have been dismissed, first as the regrettable but inevitable consequence of Thatcherite economics, and now as small-minded opponents of social progress and racial diversity. Unsurprisingly, people who feel that their wishes have been ignored and in some cases actively squashed by successive governments of left and right did not expect to wake up on the morning of 24 June to discover that this time, their votes really had changed something.

Equally unsurprisingly, the Remain campaign’s warnings of economic collapse lacked force for people for whom the world’s end had been and gone.

In Glasgow in 2014 Scottish independence was a question of identity in itself, whereas in Hull, hostility towards Europe is the by-product of other identities that feel beleaguered or under threat: fishing, Englishness and whiteness, for the most part.

In Hampstead, a vote for Remain feels more like a statement about the world as you see it. One woman, who walks off before I can probe further, tells me: “Of course I’m voting to stay In. I buy Fairtrade.”

***

Immigration, not the European Union, is the issue that moves voters in Hull. “Britain is full” was the most frequent explanation they gave for an Out vote. Knowing that immigration, rather than the abstract question of sovereignty, would be crucial to winning the contest, Vote Leave tried from the beginning to make it a referendum on border control. Leave’s main theme: the threat of Turkey joining the European Union and, with it, the prospect of all 75 million Turks gaining the right to live and work in Britain.

Although Turkey’s chances of joining the EU are somewhere only just north of its hopes of launching a manned mission to Mars, the tactic worked: according to an ­Ipsos MORI poll released on the morning of 16 June, 45 per cent of Britons believed that Turkey will be fast-tracked into the Union.

That same morning, Nigel Farage posed in front of a poster showing refugees – mostly from Syria and most of them non-white – on the border between Croatia and Slovenia, with a slogan warning that uncontrolled immigration was leaving Britain at “breaking point”. But the row over the poster came to an unpleasant halt just a few hours later as news began to break that Jo Cox, the Labour MP for Batley and Spen, had been shot and stabbed on her way out of a constituency surgery. She died of her injuries a little over an hour later. On 19 June Thomas Mair, who was arrested in connection with the killing, gave his name at Westminster Magistrates’ Court as “Death to traitors, freedom for Britain”.

The circumstances of the killing felt familiar. A little after midnight on 5 June 1968, Robert Kennedy was returning to the Ambassador Hotel in Los Angeles in high spirits. He had just won a crucial victory in the California primary and was well placed to secure the Democratic nomination to run in that year’s presidential election. Going through the kitchen in order to avoid cheering crowds and get straight to his press conference, he was ambushed by a man called Sirhan Sirhan, who fired six shots from a revolver. Kennedy was rushed to hospital, where he died early the following morning.

Five months later Richard Nixon was elected president. The American right held on to the White House for 20 years out of the next 25. Jo Cox’s killing, amid the nativist howling from Farage et al, felt like the beginning of a similar chapter of right-wing advance in the UK.

Labour’s problem, and that of its social-democratic cousins throughout Europe, is the same as the American left’s was in the 1960s. Its founding coalition – of trade unions, the socially concerned middle classes and minorities, ethnic and cultural – is united (barely) on economic issues but irrevocably split on questions of identity. Outside crisis-stricken Greece and Spain, the left looks trapped in permanent opposition, with no politician able to reconsolidate its old base and take power again.

***

When I arrive in Hull, preparations are under way for a vigil in Jo Cox’s honour, but it is the nation of Turkey that is weighing on the minds of undecided voters. On Park Street, residents are divided. Those who have exercised their right to buy and are concerned about their mortgages are flirting with an Out vote but are terrified about negative equity. Those who remain in social housing or the private rented sector are untouched by stories of soaring mortgages. To many residents, the Treasury’s dire warnings seem to be the concerns of people from a different planet, not merely another part of the country. As Rachel, a woman in her mid-fifties who lives alone, puts it: “They say I’d lose four grand a month. I don’t know who they think is earning four grand a month but it certainly isn’t me.”

As Vote Leave knew, the promise that an Out vote will allow people to “take control” always had a particular appeal for those with precious little control – of their rent, of next week’s shift, of whether or not they will be able to afford to turn the heating on next week. Never mind that the control envisaged by Vote Leave would be exercised by the conservative right: the campaign found a message that was able to resonate across class and region, at least to an extent that could yet create a force to be reckoned with under first-past-the-post in Britain.

Four grand a month isn’t a bad salary, even in leafy Hampstead, but in that prosperous corner of north London fears of an Out vote, and what will come after, gained a tight purchase. The worry was coupled with resentment, too, over what would come, should the Outers triumph.

The great risk for the left is that herbivorous resentment is already curdling into contempt towards the people of Hull and the other bastions of Brexitism. That contempt threatens the commodity on which Labour has always relied to get Hull and Hampstead to vote and work together – solidarity. The referendum leaves the Conservatives divided at Westminster. That will give little comfort to Labour if the long-term outcome of the vote is to leave its own ranks divided outside it.

 

Stephen Bush is special correspondent at the New Statesman. He usually writes about politics. 

This article first appeared in the 23 June 2016 issue of the New Statesman, Divided Britain