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.

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What would a Trump presidency mean for the rest of the world?

It would be wrong to hope that either domestic or international checks and balances will constrain Trump abroad. Geopolitically, the result would be unpredictable – at best.

The conventional wisdom about Donald Trump runs something like this. Trump is a buffoon. His solutions to world problems are not policies at all, but merely a set of contrarian reflexes. They will soon be ­exposed in the next televised presidential debate against his rival Hillary Clinton, who put in a strong performance during the first round. He is, critics say, a mere pied piper whose “deplorable” followers suffer from false consciousness about their true economic interest. Trump’s election would be a disaster, the argument runs, but his policies will soon prove impracticable.

The conventional view is wrong. Although his personal behaviour is often clownish or boorish, and he has shown astonishing ignorance of some important international issues, Trump has a perfectly coherent world-view and strategy which are rooted in certain established American traditions, even if these are now largely defunct. Most of his followers know exactly what they are voting for and they are right to believe that he will deliver, or at least attempt to do so. As for the idea that a Trump presidency would be a disaster, that is completely wide of the mark. It is actually much worse than most people think. President Trump has the potential to be an unmitigated catastrophe – if not for the United States, then certainly for the rest of the world.

Far from taking a leap in the dark, Trump supporters know that they will be voting for a clearly defined package of domestic and foreign-political measures. With Trump, in ways that are not really true of his predecessors, or of Hillary Clinton, the two spheres cannot be usefully separated. He stands for the protection of American jobs at home, and therefore for a restrictive trade policy abroad. He wants to get tough on terrorism by having recourse to torture, in both the United States and the rest of the world. He wants to increase military spending. He wants to “put America first” and increase investment in schools and infrastructure in the United States, and therefore eschews “nation-building” abroad.

We should not assume that this is just rhetoric. First, because Trump has been saying all this, or much of it, for years in his writings and in off-the cuff statements. He is no mere opportunist. Second, because we know from scholarly analysis of recent campaigns, such as the one carried out by the former White House adviser and political scientist Steven Schrage, that presidential policies often quite closely track those advanced during the campaign. Third, because Trump emerges from the confluence of two long-dormant but now resurgent American political traditions: the blunt, early-19th-century appeal of Andrew Jackson to the “common man” and the protectionist isolationism that produced the Smoot-Hawley tariffs and the Charles Lindbergh of the 1930s.

When contemplating Trump, critics often focus on his domestic consequences. They foresee an empowering of white supremacist discourses and a surge in hate crimes, especially against Muslims. These are reasonable fears, but the threat Trump poses to politics within the United States is probably overstated. There will certainly be an increase in racial tension and other forms of unpleasantness, but American society is resilient, diverse and fundamentally decent, even if some of it is currently trying to prove the opposite. The US is not seriously at risk of lapsing into the kind of populist authoritarianism we see in many other parts of the world. Moreover, the nature of the American constitution is such that Trump will be very constrained in what he can do at home: by Congress, by the courts and various other checks and balances.

There are far fewer impediments, however, to presidential power in foreign policy. As so much of Trump’s domestic programme depends on what he does abroad, the rest of the world will be much more exposed to a Trump presidency than the Americans themselves.

Trump’s impact on the world will initially be a matter of style. He has shown himself to be misogynistic, vindictive, xenophobic and unafraid to trample on the feelings of veterans or the bereaved. This would be neither here nor there – tastes differ, after all – were it not that Trump’s personality will translate internationally into an instinctive rapport with other “outspoken” leaders such as Vladimir Putin in Russia, Recep Tayyip Erdogan in Turkey or Rodrigo Duterte in the Philippines. In the event of disagreement between them and Trump, we might expect a degree of vituperation on both sides in ways that are not compatible with the long-established dignity of the presidency of the United States.

Style will soon become substance. At best, a Trump presidency will lead to the “Berlusconification” of international politics, which will become extended reality-TV events, at least in so far as they relate to the United States. More seriously, his antics will empower and encourage a coarsening of the discourse between states and about world problems. Here, the contrast with Presidents George W Bush and especially Barack Obama, whatever one thinks of their policies, could not be sharper.

Trump’s style will matter in international politics for another reason. First, despite all his rhetoric about deal-making, where his business experience is considerable – and he has sometimes shown a capacity to compromise – he seems to have a very limited and belligerent idea of what constitutes a successful diplomatic negotiation. Rejecting notions of “win-win”, Trump views a political “deal” as the imposition of his will on the other side. “In the end,” he writes of one successful transaction in his bestselling book The Art of the Deal, “we won by wearing everyone else down.” It is therefore no surprise that he cleaves to an essentially mercantilist view of world trade in which, say, Japan’s gain is America’s loss. Given his severe anger management issues, the great danger is that a clever adversary will get under his skin, provoke outbursts, and either make a laughing stock of the greatest power on Earth or precipitate a confrontation.

Second, Trump favours a particularly intuitive style of decision-making. He has gone on record as saying that people “are surprised by how quickly I make big decisions, but I’ve learned to trust my instincts and not to overthink things”. Of course, it is true that international politics often requires leaders to make speedy decisions, yet it is deeply worrying to think what Trump’s instincts will lead to when he has the proverbial finger on the button. This problem has already been commented on by a phalanx of Republican national security experts, none of whom thinks he should be entrusted with the nuclear codes.

No reliance should be placed here on the restraining force of his advisers, or of the bureaucracy in the US state and defence departments. Trump has already signalled that he will not listen. When asked a few months ago to identify those he consulted most often on foreign affairs, he replied: “I’m speaking with myself, number one, because I have a very good brain and I’ve said a lot of things.” The foreign policy “team” he has produced during the campaign is the weakest and most obscure that anybody has encountered in living memory.



The essence of Donald Trump’s vision for the world is the revival of American national greatness. He wants to “make America great again”. “Americanism, not globalism, will be our credo,” he says. His slogan “America First” is an unashamed borrowing from the isolationist platform of the 1920s and 1930s.

By contrast with every single Democratic and Republican president since the Second World War, including George Bush, Jr, Trump rejects the international liberal order. In office, this will be reflected in his opposition to global human rights initiatives, whether that be the banning of torture, or collective action to help Syrian refugees (whom he sees not as victims but as an Islamist national security threat). He will ride roughshod over human rights sensitivities when building his wall with Mexico. On the environment, Trump is likely to abrogate the Paris accord on greenhouse-gas emissions and to press ahead with work on the disputed Keystone oil pipeline between Canada and the US, as well as other projects.

He may well also play fast and loose with the national debt, having suggested that he may not repay it or the interest in full. “I’ve borrowed knowing that you can pay back with discounts,” he explains, adding that “I would borrow knowing that if the economy crashed you could make a deal”. But he may find that his ability to bounce back no fewer than four times from business bankruptcy may not be a transferable skill.

The other area in which Trump plans to tear up the international rulebook, and here the parallels with his opposition to gun control are evident, is the field of nuclear non-proliferation. He has repeatedly welcomed the idea of a Saudi, or South Korean, or Japanese nuclear bomb. The thinking is that this will achieve a balance of terror, which will keep the peace better than costly American intervention.

Cumulatively, all this will cause considerable disruption. It will unravel many of the webs of international society carefully woven over the past six decades or so. It may well make the Korean Peninsula or the Gulf even more unsafe. It will certainly make life unpleasant for Mexico. And it will lead to the end of the United States acting as the world’s policeman. The US will step up the number of global snatch-squads in the war on terror, certainly, but will cease to exercise a general superintendence over the defence of democracy and human rights. No Iraqs, perhaps, but also no interventions in Bosnia or Kosovo. The worst, however, is yet to come.

At the heart of Trump’s revolt against the liberal order, undoubtedly, is economics. Reviving the national economy is essential to his vision of making America great again. Central to that project is a revision of the terms of trade. Trump is convinced that the US is getting a raw deal, not only from its enemies, but also – and most importantly – from its friends. He might well overturn the North American Free Trade Agreement, will probably disavow the Trans-Pacific Partnership, and is most unlikely to go through with the Transatlantic Trade and Investment Partnership, assuming it is not killed off first on the other side of the Atlantic. He would not be above leaving the World Trade Organisation altogether. Above all, Trump will take on China, which he accuses – with considerable justice – of currency manipulation and sharp practices. At the very least, he will instruct the US ­department of commerce to take cases against China and he may well embark on a full-scale trade war.

If Trump’s grand strategy will begin with economics and trade, it will not end there. His measures will unleash their own, essentially geopolitical dynamic. At the moment, the Chinese are contemplating the prospect of a Trump presidency with remarkable insouciance. They seem to regard him as one of their own, a man who will not bother them with human rights sermons, and with whom they can do business. In some ways they are right: he is one of them. That, however, is the problem. Trump shares their ­zero-sum view of the world, and he explicitly intends to prevail at their expense.




Nobody has ever looked inside the “black box” of an all-out trade confrontation between China and the United States. Even if one thinks – as this author does – that some form of reckoning with China is necessary, Trump is surely the man temperamentally least suited to lead it. His strategy may revive American manufacturing, but modern supply chains are such that China is inextricably stitched into the US industrial ecosystem in ways that could defy safe unravelling. Yet one thing is clear: China, which holds a huge chunk of the US federal debt, will bitterly resist any attempt to repudiate it. Moreover, if unplugged from the US market, particularly at a time of falling European demand, China will face vast economic dislocation and consequent internal unrest. One way or the other, the reaction to any such measures by the Americans will be violent, with a countdown to conflict comparable only to the one triggered by Franklin D Roosevelt’s decision in 1941 to freeze all Japanese assets in the US and impose an oil embargo on Japan.

Another arena where Trump will give the kaleidoscope an almighty kick is Europe. His hostility to the European Union – the principal instrument of the continental order hitherto strongly supported by the United States – is well documented. This will add yet another problem to the long list already confronting Brussels and the national governments. As if that weren’t bad enough, Trump will encourage the European “deplorables”: Alternative für Deutschland in Germany, Jobbik in Hungary and the French Front National. His xenophobia and authoritarian personality will chime with them; his protectionism may even resonate on the European left. He will therefore be much less isolated in Europe than many like to think.

Worse still, the example of a wall with Mexico may well inspire similar endeavours in Europe – in the Balkans and the Mediterranean (where some barrier is necessary to defend the external boundary of the Schengen passportless travel zone), but also in central Europe and perhaps even within the core of the EU, thus destroying free movement of people on mainland Europe. The period from 1989 to 2016 may become known as “the interwall era”. The walls will go up across Europe and we may not see them brought down again in our lifetime.

But the deadliest threat to European security is Trump’s attitude to Nato. He has repeatedly questioned whether the United States should continue to protect Europe, most of which fails to pay its agreed contribution to the common defence. Here – unlike in the cases of South Korea and Japan, which largely pay their way on defence – he has a point. It is negated, however, by his undisguised admiration for Putin, the single greatest threat to the stability of the European order. One of Trump’s top military ­advisers, Michael T Flynn, a retired general, is a Russia enthusiast. One of his most trusted former confidants, Paul Manafort, served as a long-term political consultant to the disgraced ex-president of Ukraine and Russian stooge Viktor Yanukovych. One of his few named foreign policy advisers, Carter Page, also has close links to Russia.

Everything points to a President Trump lifting sanctions on Putin before time and recognising Russia’s annexation of Crimea. He is also highly likely to undermine the value of Nato’s Article 5 guarantee of collective defence, which will place the Baltic and Black Sea states and Poland in the firing line. Yet he seems oblivious to this danger, largely because he does not take Russia seriously in economic terms. It is one of the many failings of his foreign policy, and a surprising one, given his general belligerence, that he
does not take other factors, such as ideology or raw military power, much into account.

Geopolitically, the results of all this are entirely unpredictable and could lead to a different global strategic balance. In effect, Europe will be left on its own to stand against Russia and defend Western values worldwide. Putin may be emboldened to take risks, in Ukraine, in eastern and northern Europe, and elsewhere. On the other hand, he may prefer to explore a strategic partnership with Trump. That will surely begin with a joint effort to support the Assad regime in Syria, and probably develop into an alliance against China. In that case, we will be in a genuinely tripolar or even quadripolar world, in which the relationship between the Russo-American alliance, the British-European confederation and the other Eastern dictatorship, China, will be one of unstable equidistance.




Finally, it would be wrong to hope that either domestic or international checks and balances will constrain Trump abroad. The executive will be bound to obey most of his orders in theory and probably all of them in practice. It is true that the military, the CIA and law-enforcement officers might, as the former National Security Agency and CIA director Michael Hayden has suggested, refuse to follow an “illegal” order. It is also possible that Congress might hold up international trade measures in so far as they relate to treaties. The EU may even be so appalled that it rallies in the face of Trump.

Yet this is wishful thinking. Crucial questions, such as whether to deliver on a Nato Article 5 guarantee in Europe, are matters to be decided by the executive alone, and for good reason. Moreover, Trump will have much of the United States behind him in making his initial foreign policy moves. Demand that the Europeans “pay up” for their own defence? Why not? Beat up on China’s protectionism? What’s not to like? As for Isis, even Homeland’s Peter Quinn thinks that the solution is to “pound Raqqa into a parking lot”. It would take superhuman moral and political courage to stop Trump early on. And with Europe, the idea that it will show resolve in the face of an external threat is, sadly, a sign of the triumph of hope over experience. Many Europeans, in fact, will cheer him on. At home and abroad, Trump will the harvest low-hanging fruit first, and then invest the capital gained in riskier enterprises. When he does really overstep the mark, it will be too late.

There is a very thin silver lining in all of this, at least for Britain: Trump is a known enthusiast for the United Kingdom. He has come out strongly against Scottish independence. He will almost certainly favour London over Brussels in trade matters. Above all, with him in the White House, Theresa May will be the only grown-up left among the major military powers of the West. The EU will almost certainly try to compensate for the loss of an interlocutor in Washington by moving closer to London. Britain will probably also benefit from an outflow of American “creatives” after a Trump victory – at least, of those for whom Canada isn’t far away enough. Britain may well also attract talent from around the world that would otherwise have gone to Silicon Valley or other centres of innovation in the United States.

In short, President Trump is likely to deliver a severe shock to both the US and the rest of the world. Although at home there are clear limits to what he can achieve, there are far fewer constraints abroad. There is little doubt, therefore, that the Americans, and probably the British, will survive Trump. The question is: will the rest of us?

Brendan Simms is an NS contributing writer. His latest book is “Britain’s Europe: a Thousand Years of Conflict and Co-operation” (Allen Lane)

This article first appeared in the 06 October 2016 issue of the New Statesman, Trump's triumph