Seventeen years after Hugo Chávez was elected Venezuela’s President for the first time, the supporters of his Bolivarian Revolution, now led by President Nicolás Maduro, suffered their first major defeat in a national election in the December 6 elections to the country’s parliament, the National Assembly.
Coming only two weeks after the victory of right-wing candidate Mauricio Macri in Argentina’s presidential election, it was a stunning setback to the “process of change” in Latin America that Chávez had spearheaded until his premature death from cancer in 2013. The opposition majority in the new parliament threatens to undo some of the country’s major social and economic advances of recent years as well as Venezuela’s vital support to revolutionary Cuba and other neighboring countries through innovative solidarity programs like PetroCaribe and the ALBA fair-trade alliance.
The election result is an important gain for Washington as it mounts renewed efforts to restore neoliberal hegemony in Latin America and fracture the new continental alliances (UNASUR, CELAC) that Chávez was instrumental in initiating as alternatives to the US-dominated OAS.
A decisive majority for the opposition Rightists
Under Venezuela’s mixed electoral system, which combines direct election of deputies with proportional representation of parties, the right-wing opposition coalition Democratic Unity Roundtable (MUD, by its Spanish acronym), with 56.2% of the popular vote, won 109 seats. With the support of three indigenous deputies, elected separately, the MUD could have a two-thirds majority in the 167-seat unicameral Assembly.
The vote for President Maduro’s United Socialist Party (PSUV), which campaigned in alliance with smaller parties in the Gran Polo Patriótico Simón Bolívar (GPP), was 5,622,844, just under 41% of the total. The GPP won a total of 55 seats: 52 for the PSUV plus 3 for its allies, including 2 for the Communist party. (After the election, Venezuela’s Supreme Court (TSJ) suspended the swearing in of four incoming legislators — three opposition, one PSUV — pending investigations of voting irregularities in Amazonas state. More on this below.)
With a “super majority” of two-thirds of the seats, the opposition MUD has the constitutional and legislative power to, among other things:
- Block government spending and ministerial appointments;
- Unseat Supreme Court justices;
- Remove the Vice-President;
- Convene a National Constituent Assembly, and initiate a recall referendum for President Maduro (although under article 72 of the Constitution, a call for a referendum to remove a public official from office requires the signatures of 20% of the electorate);
- Submit international treaties, conventions or agreements to referendums; and
- Pass or modify any draft organic law (laws enacted to develop constitutional rights, which serve as a normative framework for other laws, or which are identified as such by the Constitution).
In short, writes Lucas Koerner in Venezuelanalysis.com,
a two-thirds majority gives the opposition all of the institutional weapons necessary to reverse many of the key transformations of the Venezuelan state achieved by the Bolivarian Revolution over the last seventeen years.
They will now be empowered to revoke critical revolutionary legislation such as the Organic Law of Communes, the Organic Work and Workers’ Law (LOTTT), among numerous others, repeal international treaties such as the ALBA-TP and PetroCaribe, as well as pack the Supreme Court with an eye towards impeaching President Nicolás Maduro.
Why the opposition victory?
Whether the MUD will do all or any of these things, of course, depends on a number of factors that are not necessarily within its control — above all, how the social and class forces in Venezuela react in the changed political landscape. The MUD itself is not a cohesive political party, and has many divisions among its components. It is composed of 18 parties, 13 of which are now represented in the National Assembly! They are united primarily by their opposition to Chavismo, the spirit and program of the Bolivarian Revolution championed by Hugo Chávez and his successors. But can the election result be interpreted as a vote against Chavismo as such?
With a voter turnout of 74.5% (up from 66.4% registered in the previous legislative election, in 2010), the PSUV gained more than 350,000 votes over its result in 2010. However, it lost almost 2 million votes from the more than 7.5 million for Nicolás Maduro, the PSUV candidate in the 2013 presidential election. Where were those losses registered? Gabriel Hetland, a US professor specializing in Venezuelan politics and a first-hand observer of the election, notes that the opposition vote in affluent districts “was nearly identical to what it was in the 2010 National Assembly election.” It is clear, he writes in The Nation,
“that the MUD’s overwhelming victory was due to widespread support among popular sectors that have traditionally favored Chavismo. The MUD won 18 of 24 states, including Hugo Chávez’s home state of Barinas and erstwhile Chavista strongholds in Caracas such as 23 de Enero, Catia, and Caucaguita, a very poor district that abuts Petare, one of the largest barrios in Latin America.”
Hetland reports on his conversations with voters on election day:
“In the popular-sector voting centers I visited I encountered numerous people planning to vote for the opposition. In one barrio in the city of Porlamar… only two of the 18 people I spoke with planned to vote for the PSUV. None of the voters supporting the opposition mentioned liberty or democracy as a reason for doing so. All of them said they were supporting the opposition because of the material difficulties they faced. “I want change,” a woman told me. Pointing to the baby she was holding she said, “I can’t buy formula, and my father, who is 60 years old, had to go to another country for medical treatment” because the medicine he needed was unavailable in Venezuela. Over and over I was told of people’s frustrations with long lines and shortages of food and basic goods. Another young woman holding a baby said, “I get up at 4 am to stand in line and I can’t even buy food. I want change.” As she said this, the women standing next to her nodded their heads vigorously.”
“The sentiments expressed by these voters suggest that it’s more accurate to think of the election result less as a victory for the opposition and more as a rejection of the government.”
As Hetland indicates, voter disaffection with the PSUV reflected the harsh effects of the country’s current economic crisis on the conditions of ordinary Venezuelans, including many who in the past have voted by large majorities in support of the Chavista government. It was a “voto castigo,” a punishment vote.
The shortages of basic goods, the high inflation, and the currency devaluation now afflicting millions of Venezuelans are directly linked in one way or another to the country’s dependency on hydrocarbons production. Oil accounts for more than 95% of Venezuelan exports, and almost half of its fiscal income. High oil prices made it possible for the government to invest heavily in social programs, education and efforts to diversify the economy.
However, the international price of oil has dropped precipitously in recent years with the outbreak of the global capitalist crisis in 2008 and the recent exponential increase in North American production as a result of new, environmentally disastrous techniques like fracking and tar sands production. The increase in US production alone has drastically cut the demand for foreign oil by the world’s biggest consumer — and now biggest producer — of petroleum. The dependent oil-producing countries have failed to develop a common strategy in response — Saudi Arabia, fearful of losing market share, has rejected pressure from Venezuela and others to raise prices — and OPEC, revived in 1999 by Hugo Chávez, has ceased to be a serious player in international markets.
The drop in the international price — from US$100 or more per barrel to less than $30 today — has cut deeply into Venezuelan state revenues. Although the government has maintained spending on social programs and continued to provide inexpensive oil to its Caribbean neighbors, it has had to borrow to cover budget deficits; its total foreign debt increased from 10% of GDP in 2006 to 25% of GDP in 2014 (although this is still a relatively low debt to GDP ratio compared to the rest of Latin America).
When the government curtailed access to dollars at the official exchange rate, the black market exchange rate shot up, increasing exponentially in 2014-15. While the official rate has been fixed at 6.3 bolivars to the dollar since 2013, by the end of 2015 the black market was offering 800 bolivars to the dollar. This in turn played havoc with the price controls the government had imposed for most essential goods in order to counter retailers’ tendency to sell at the black market rate instead of the official rate. This meant that over time more and more products were priced far below the price they could obtain in neighboring countries.
More and more Venezuelans will acquire dollars at the official rate, purchase goods at the subsidized prices for many necessary products, then export them across the border for an enormous profit. Some major companies, writes Telesur correspondent Gregory Wilpert, are involved in this process too, “claiming that they need to import essential goods, and then either not importing these or re-exporting them to acquire dollars. In mid-2014 Maduro estimated that up to 40 per cent of all goods imported into Venezuela (at the official exchange rate) were smuggled right back out again.”
The state has found itself forced to use its dollar currency reserves to import massive amounts of basic products, which it then sells at subsidized prices through state-owned distribution channels. This allows Venezuelans access to a limited amount of basic foodstuffs at low prices. But since these products are scarce, the black market increases exponentially and prices reach many times the regulated price.
“The situation has now become truly untenable,” writes Jorge Martin. “Ordinary working people are forced to queue for hours on end to be able to access small amounts of products at regulated prices in the state-owned supermarkets and distribution chains, and then pay extortionate prices to cover the rest of their basic needs.”
Martin notes that Venezuela’s GDP contracted 4% in 2014, and is forecast to fall by a further 7% to 10% in 2015. “President Maduro has said that inflation this year will be 85%, but many basic products have already risen by an annual inflation rate of over 100%. The IMF forecasts an inflation rate of 159% for the whole year in 2015.”
Corruption and inaction
While oil income from royalties and taxes has until recently brought extraordinary state revenues, also extraordinary are the amounts that are effectively embezzled through the joint collaboration of corrupt Venezuelan capitalists and a section of the state bureaucracy, often linked together through interlocking directorships in banks, insurance companies, firms that contract with the state, and even family members located abroad, using a variety of techniques: import fraud, speculative maneuvers with sovereign debt certificates, negotiation in marginal markets of currencies and debt certificates of the state oil corporation PDVSA, etc.
In one of a series of in-depth exposés of this process, which it describes as a “mafia-like accumulation of capital,” the left pro-Chavista tendency Marea Socialista has documented net capital flight by the “Boliburgesía” (the new “Bolivarian” bourgeoisie) of almost $260 billion (US) between 1998 and 2013 alone. This, it notes, is equivalent to 25 times the cost of Brazil’s World Cup expenditures, 10 times the fall in state income caused by the anti-Chávez oil industry shutdown in 2002-03, the construction of 6 million new homes under the government’s current housing mission, or 37 times the difference between subsidized gasoline sales prices and the cost of production.
There were of course other reasons for the government defeat, as TeleSUR correspondent Tamara Pearson explains: among them, disinformation by the opposition media (still predominant in Venezuela); recent setbacks for the left elsewhere in Latin America themselves linked to the global capitalist crisis; and the alienation of many younger voters who “don’t remember what it was like in Venezuela before Chávez was elected in 1998.” But she notes as well that
“while the opposition has attracted some of the less politically aware social sectors to its anti-Chavismo discourse, the government has also lost some ground from conscientious and solid revolutionaries, partly due to its lack of a solid response to the opposition’s ‘economic war.’ Although it’s easier said than done to combat a rentier state, capitalist system, historical corruption, and big business’s campaign of economic sabotage, Maduro has only announced things like national commissions to deal with the situation.
“While people spend up to seven hours a week lining up for food, and while many of them understand that the government isn’t directly responsible for the situation, the lack of a serious response and significant measures hasn’t helped support for the government.”
Further, says Pearson,
“while the government clearly sides with the poor, for multiple reasons including more right-wing attacks, it has becoming increasingly distanced from the organized grassroots…. [W]ith the way the government communicates with the people, the way it gets information out and involves people in serious decision making — there has been a step back in recent times. This aspect of the Bolivarian revolution is perhaps the most important, so the significance of it and its impact on people shouldn’t be underestimated.”
Some immediate responses to election verdict
President Maduro promptly accepted the official election results but pledged to continue defending the progressive laws and social programs adopted and implemented during the last decade and a half. A new stage is opening in the Bolivarian Revolution, he said in his election night address, a stage in which the central task is to deepen the revolution by building the country’s productive capacity at all levels — “communal, communitarian, industrial and regional.” Venezuelans, he added, should see the current difficulties in the oil industry as “warnings… and as opportunities to replace the rentist petroleum system with a self-sustaining, self-sustainable productive economic system.”
(This would require some major changes in the present program of the PSUV, the Plan de la Patria or Plan for the Fatherland. Although it lists as one of its five major historical objectives “going beyond the capitalist petroleum rentist model,” it also calls for doubling Venezuelan oil production from 3.3 million barrels per day in 2014 to 6 million in 2019.)
Following Maduro’s election night speech, hundreds of Chavista activists from various popular movements marched in solidarity the next morning through the streets of Caracas to the presidential palace (Miraflores). Maduro invited the crowd to send in representatives to meet with him to discuss the next steps. In this and two subsequent meetings, 185 voceros or spokespersons of communes, commandos, brigades, etc. hammered out some lengthy documents outlining what they considered key objectives to be pursued in the coming months. In addition to proposals for greater government control over foreign trade, banking and finance, more effective tax collection and a sustained fight against bureaucracy and corruption, a central theme was the need to strengthen the role and productive capacities of the communal councils and communes, the territorially based grassroots organizations that the Chavistas see as the foundational units for the eventual creation of a “communal state” of direct democracy “from below” to replace the top-down bureaucratic administration of the capitalist state.
A theme heard more and more in the extensive public debate now underway in radio and TV, on web sites and in the social media is the need to move toward nationalization of the major banks and financial institutions, and possibly to establish a state monopoly over foreign trade — essential measures, in my view, if Venezuela is to establish public control over the speculators and protect itself from the worst vagaries of uncontrollable world prices.
Maduro has established work teams to systematize these and other such grassroots proposals in a “central document of the Bolivarian Revolution” as a guide to action in its new stage. And he has convened an organizing committee to meet January 23 to prepare a “Congress of the Fatherland,” although providing few details on what he has in mind.
On December 15 Diosdado Cabello, PSUV deputy leader and president of the outgoing National Assembly, presided over the first gathering of the National Communal Parliament. This legislative body was provided for in the Organic Law of Communes, adopted in 2012, but it was only recently that there was a sufficient critical mass of municipal and regional communes to convene it. The communes had begun electing delegates (voceros) to this body in August 2015. It was originally intended that it would function as an adjunct to the National Assembly. “Now it’s up to you in the National Communal Parliament, to discuss and present proposals that you consider necessary to help President Nicolas Maduro,” Cabello told the delegates. He said this grassroots parliament would help to shield the country’s laws of Popular Power from right-wing attempts to rescind them in the new National Assembly.
The Communal Parliament has met several times since, and in early January announced that its voceros from Venezuela’s 24 states would meet February 4 to adopt their internal rules of functioning, which will then be published in a new monthly publication, the Gacetas Comunales.
In a parallel development, the outgoing National Assembly hastily adopted in late December a spate of pending legislation that was promptly ratified by Maduro in accordance with the Constitution. A major one, the Law of Presidential Councils of the People’s Power, will provide a means for direct citizen input in decision-making by the government (in this case, the President). The purpose, as the introduction to the law proclaims, is “to strengthen the System of Popular Government” by establishing a basic network that “addresses in a profound way the concrete problems of the population through policies, plans, programs and projects for sectoral development… based on the principles and values enshrined in the Constitution….”
Also adopted was a ground-breaking Anti-GMO and Anti-Patenting Seed Law, the result of an ongoing grassroots campaign by environmental and campesino social movements over the past two years. “The law is a victory for the international movements for agroecology and food sovereignty,” write the authors of the linked article, “because it bans transgenic (GMO) seed while protecting local seed from privatization.
“The law is also a product of direct participatory democracy — the people as legislator — in Venezuela, because it was hammered out through a deliberative partnership between members of the country’s National Assembly and a broad-based grassroots coalition of eco-socialist, peasant, and agroecological oriented organizations and institutions.”
The new opposition-dominated National Assembly may very well attempt to reverse some or all of these legislative gains, of course. However, PSUV deputy Diosdado Cabello, the former Assembly president, notes that the Constitutional Division of the Supreme Court may disallow national laws “which are in conflict with this Constitution, including omissions… in failing to promulgate rules or measures essential to guaranteeing compliance with the Constitution.”
On January 6 President Maduro reshuffled his cabinet and created several new ministerial departments as part of an “economic counter-offensive.” He said the new leadership team would prioritize agricultural production as part of a plan for economic recovery.
MUD aims for destabilization – and overthrow of Maduro
Maduro was scheduled to present a detailed report on his plans to the new National Assembly on January 12, although he acknowledged that there was no assurance it would accept them.
However, on January 12 the Assembly session was adjourned in confusion, followed soon after by a humiliating backdown by the MUD majority. As mentioned earlier, three of the MUD deputies had been suspended by the Supreme Court for alleged irregularities in their election. However, when the new Assembly first met, the MUD swore in the three, in defiance of the Court. The Court responded by declaring that the Assembly proceedings would then be of no force or effect. Now, with the PSUV absent and only a handful of MUD deputies present, the Assembly president Henry Ramos Allup (himself an old-line politician elected president in a private session of the MUD, contrary to Assembly rules) then found there was no quorum and adjourned the proceedings.
However, amidst the ensuing public outcry at these shenanigans, the three suspended deputies wrote to the leadership of the Assembly asking that their swearing-in be reversed. The next day, Ramos Allup called the Assembly to order, had the Supreme Court ruling read aloud, then stated that the Assembly leaders would “abide by the ruling of the Supreme Court.” But Maduro has yet to give his promised report.
The opposition’s climbdown probably reflects strategic divisions within their ranks between a relatively moderate faction led by Henrique Capriles, which is said to favour posing as a credible alternative to the government with proposals to solve the economic crisis, and a more confrontationist faction, apparently dominant, which is led by virulent opponents of the government. Its main leader is Leopoldo López, currently serving a 13-year prison sentence for his involvement in the guarimba street protests in 2014 that resulted in 43 deaths, as well as other violent actions. Both Capriles and López have links to the coup plotters of 2002.
The opposition’s initial defiance of the Supreme Court underscored its determination to steer toward an outright confrontation with President Maduro, with the goal of destabilizing his government as much as possible. Ramos Allup says he hopes to prepare Maduro’s ouster within the next six months. Another primary goal is passage of an amnesty law to free what the opposition terms “political prisoners,” that is, all those who have been involved in violent protests (including Leopoldo López).
Among other promised or rumoured measures favoured by the anti-government majority in the Assembly, writes Greg Wilpert, are a law
“to give ownership titles to the beneficiaries of the housing mission. Over the past five years the government has constructed one million public homes, which it has essentially leased to families in perpetuity, but without giving them a title that can be bought and sold. The reasoning behind this is to avoid the development of a speculative housing market of homes built with public funds. The opposition is betting that most public housing beneficiaries would prefer a saleable ownership title, so that they can sell the home and thereby possibly make a profit from it.
“… a rumored project to dollarize the economy. It is obvious to everyone in Venezuela that the current economic situation of high inflation, frequent shortages of basic goods, long lines at supermarkets, and a massive black market for price-controlled products, is not sustainable. One ‘solution’ to these problems that some opposition leaders have favored it to simply get rid of the local currency, the bolivar, and base the entire economy on dollars, just as Ecuador did in 2001. Aside from undermining the country’s economic sovereignty, such a move would also almost definitely mean major painful displacements for economy, leading to increased inequality and unemployment. …
“Other major projects on the opposition docket,” reports Wilpert, “include the repeal of a wide variety of progressive laws that were passed during the Chavez and Maduro presidencies, beginning with the land reform, [and including] re-privatization of key industries and the dismantling of price controls, among other things.”
Capriles has also proposed a “padlock law” to “put an end to oil diplomacy” and “stop the government from giving away and wasting the country’s resources” — a threat clearly aimed at the PetroCaribe initiative that has provided Caribbean countries including Cuba with much-needed oil at preferential repayment rates.
Needless to say, little of this was mentioned in the MUD election platform.
Basically, the virulence of the opposition majority in the legislature — they have even removed portraits of Hugo Chávez (and Simón Bolívar!) from the Assembly precincts — reflects the visceral determination of the class they represent to avenge and reverse not only the laws but the very foundations of the Bolivarian regime initiated by Chávez and his original Movement for the Fifth Republic. No wonder this opposition holds the 1999 Constitution and its institutions in such contempt. That Constitution effectively terminated the institutional setup underlying the rule of the bourgeois elites who had monopolized political power for generations, characterized by the sham alternance of two similar capitalist parties cemented in the infamous “Punto Fijo” accord. In its place the new Constitution outlined the creation of a real sovereign democracy in which the great mass of the population were to be the “protagonists,” the living actors, of their destiny as implemented through a variety of grassroots-operated institutional forms that are only now beginning to become reality.
A new stage — and a challenge
Apart from the role of the Supreme Court (itself threatened by the opposition-dominated National Assembly) in trying to restrain the Assembly within constitutional limits, there are now three powers contending in this conflictual context: the President, head of state and supported by the military, who have confirmed their loyalty to the Constitution and the Bolivarian Revolution; the National Assembly, at loggerheads with the President and determined to replace him and all he stands for as soon as possible; and what is commonly referred to as the People’s Power, the grassroots mobilizations of ordinary citizens organized territorially in communal councils and communes or politically in support of the “process of change” — a force that is diffuse and still lacking a coherent structured national leadership. It is unclear at this point what role this relatively new force can play in helping to overcome the current economic and political crisis. The governing party, the PSUV, is largely an electoral machine and somewhat discredited by the implication of some leaders in corruption and bureaucratic maneuvers. It needs a fundamental overhaul.
There is much talk among Chavistas of answering the crisis by “deepening the revolution,” taking a “qualitative leap” as Chávez himself advocated in his Golpe de Timón speech.
In a remarkable essay, Venezuelan militant José Roberto Duque of Misión Verdad issues a challenge. If, he says, the Presidency and the Assembly are determined to prevent each other from fulfilling its role, “then it will be technically and procedurally impossible to to legislate (the Assembly’s mission) or to govern (the executive’s mission) in Venezuela.
“As such, we will be on the threshold of a situation in which a third actor, the most important and decisive amongst state subjects (popular power, citizens, you and I) must take a position with respect to the legitimacy of the actions of our representatives….
“Today we Chavistas unanimously support the ‘Communal State’ project proposed by Chávez. How many of us are prepared to keep building that Communal State even when the National Assembly eliminates the Law of Communal Councils and the Law of the Communes in one foul stroke? Will we have the stamina to keep building the other society clandestinely and illegally? Or will we submit to bourgeois laws that order us to give the entire productive apparatus up to private business?”
Duque explores these and related questions and concludes:
“The communes should be structures that are capable of surviving at the margins of the state and government, even functioning as areas of rearguard and resistance at the moment of an institutional collapse — when the Bolivarian government ceases its functions because of either legal or illegal means.
“We must be capable then of creating and consolidating self-sustainable and self-sufficient structures. We are in a very early stage of our communard history, and that is the reason why a ministry still exists that is in charge of financing the launch of productive projects in the communes. But in the future it would be an aberration for the communes and other organisations and means of production to continue to be dependent on state financing and other entities.”
I think this is the fundamental challenge facing the Bolivarian Revolution in the coming period. But it must be accompanied by measures at the level of the existing state to overcome the economic crisis — through implementation of an emergency program that can provide immediate relief to the masses of Venezuelan workers and campesinos.
 The End of Chavismo? Why Venezuela’s Ruling Party Lost Big, and What Comes Next, The Nation, December 10, 2015.
 Capital controls were first imposed in 2002-03 in order to stabilize the currency and stop a flight of capital resulting from a bosses’ shutdown of the oil industry in the wake of their failed attempt to oust Chávez in a coup.
 Wilpert is the author of an excellent book on the Chávez years: Changing Venezuela by Taking Power (Verso, 2007).
 See, for example, Sinfonía de un Desfalco a la Nación: Tocata y fuga… de Capitales.
 See El sacudón electoral del 6D como crisis revolucionaria y motor de saltos cualitativos hacia el Socialismo Bolivariano, http://www.aporrea.org/poderpopular/n283366.html and http://www.aporrea.org/poderpopular/n283410.html.
 There are now more than 45,000 communal councils and 1,430 communes established throughout Venezuela. Most of the communes have been established since Hugo Chávez’s famous speech to his cabinet El Golpe de Timón just after his election in 2012 and shortly before his death in March 2013, in which he urged his ministers to prioritize the construction of communal democracy.
 Constitución de la República Bolivariana de Venezuela, art. 336. Here is an English translation.
 A leader of Acción Democrática, he is also vice president of the Socialist International!