Articles posted by Radical Socialist on various issues.

Lynne Stewart sentenced to ten years in prison


(Jeff Mackler is the West Coast Director of the Lynne Stewart Defense Committee.)

The full force of the U.S. criminal “justice” system came down on innocent political prisoner, 30-year veteran human rights attorney and radical political activist Lynne Stewart today, July 15, 2010.

In an obviously pre-prepared one hour and twenty minute technical tour de force designed to give
legitimacy to a reactionary ruling Federal District Court John Koeltl, who in 2005 sentenced Stewart to 28 months in prison following her frame-up trial and jury conviction on four counts of “conspiracy to aid and abet terrorism,” re-sentenced Stewart to 120 months or ten years. Koeltl recommended that Stewart serve her sentence in Danbury, Connecticut's minimum security prison. A final decision will be made by the Bureau of Prisons.

Stewart will remain in Manhattan’s Metropolitan Correctional Center for 60 days to prepare an appeal.

The jam-packed New York Federal District Court chamber observers where Koeltl held forth let our a gasp of pain and anguish as Lynne's family and friends were stunned – tears flowing down the stricken and somber faces of many. A magnificent Stewart, ever the political fighter and organizer was able to say to her supporters that she felt badly because she had “let them down,” a reference to the massive outpouring of solidarity and defiance that was the prime characteristic of Lynne’s long fight for freedom.

Judge Koeltl was ordered to revisit his relatively short sentence when it was overturned by a two-judge majority of the U.S. Court of Appeals for the Second Circuit. Judges Robert D. Sack and Guido Calabresi ruled that Koeltl’s sentence was flawed because he had declined to determine whether Stewart committed perjury when she testified at her trial that she believed that she was effectively operating under a “bubble”
protecting her from prosecution when she issued a press release on behalf of her also framed-up
client, the blind Sheik Omar Abdel Rachman. Rachman was falsely charged with conspiracy to
damage New York state buildings.

Dissenting Judge John M. Walker, who called Stewart’s sentence, "breathtakingly low" in view
of Stewart's "extraordinarily severe criminal conduct" deemed the Second Circuit’s majority opinion “substantively unreasonable.” Walker essentially sought to impose or demand a 30-year sentence.

The three-judge panel on Dec. 20, 2009 followed its initial ruling with even tougher language
demanding that Koeltl revisit his treatment of the “terrorism enhancement” aspects of the law. A
cowardly Koeltl, who didn't need this argument to dramatically increase Stewart's sentence, asserted that he had already taken it under consideration in his original deliberations.

Government prosecutors, who in 2005 sought a 30-year sentence, had submitted a 155-page
memorandum arguing in support of a 15-30 year sentence. Their arguments demonstrated how
twisted logic coupled with vindictive and lying government officials routinely turn the victim into the criminal.

Stewart’s attorneys countered with a detailed brief recounting the facts of the case and demonstrating that Stewart’s actions in defense of her client were well within the realm of past practice and accepted procedures. They argued that Koeltl properly exercised his discretion in determining that, while the terrorism enhancement provisions of the “law” had to be taken into consideration, the 30-year-prison term associated with it was "dramatically unreasonable,” “overstated the seriousness" of Stewart’s conduct” and had already been factored into Koeltl’s decision.

Stewart's attorneys also argued convincingly in their brief that the Special Administrative Measure (SAM) that Stewart was convicted of violating by releasing a statement from her client to the media was well within the
established practice of Stewart’s experienced and mentoring co-counsels– former U.S. Attorney General Ramsey Clark and past American Arab Anti-Discrimination Committee president Abdeen Jabarra. Both had issued similar statements to the media with no government reprisal. Clark was an observer in Koeltl’s courtroom. When he testified in support of Lynne during her trial one overzealous prosecutor suggested that he too be subject to the conspiracy charges. The more discreet team of government lawyers quietly dropped the matter.

As worst in such matters, government officials refuse defense attorneys client visiting rights until an agreement on a contested interpretation of a SAM is reached. This was the case with Stewart and her visiting rights were eventually restored with no punishment or further action. Indeed, when the matter was brought to then Attorney General Janet Reno, the government declined to prosecute or otherwise take any action against Stewart.

But Koeltl, who had essentially accepted this view in his original sentence, reversed himself entirely and proceeded in his erudite-sounding new rendition of the law to repeatedly charge Stewart with multiple acts of perjury regarding her statements on the SAM during her trial.

Koeltl took the occasion to lecture Stewart regarding the first words she uttered in front of a bevy of media outlets when she joyfully alighted from the courthouse following the judge’s original 28-month sentence. Said Stewart at that time, “I can do 28 months standing on my head.” A few moments earlier Stewart, with
nothing but a plastic bag containing a toothbrush, toothpaste and her various medications, had stood before Koeltl, who had been asked by the government to sentence her to a 30-year term, effectively a death sentence for Lynne, aged 70, a diabetic and recovering breast cancer victim in less than excellent health.

Koeltl dutifully followed the lead of the Second Circuit judges, who feigned outrage that Stewart could possibly appear joyful that her life was spared despite 28 months in prison. Koeltl insisted that Stewart’s remark was essentially contemptuous of his sentence and insufficient to convince Stewart of the seriousness of her “crime.” Lynne’s defense was that while she fully understood that 28 months behind bars, separating from her “family, friends and comrades,” as she proudly stated, was a harsh penalty, she was nevertheless “relieved” that she would not die in prison. Koeltl needed a legal brick to throw at
Lynne’s head and ignored her humanity, honesty and deep feeling of relief when she expressed it
to a crowd of two thousand friends, supporters and a good portion of the nation’s media.

The same Judge Koeltl who stated in 2005, when he rendered the 28-month jail term, that Lynne was
“a credit to her profession and to the nation,” clearly heard the voice of institutionalized hate and cruelty and responded in according with its unstated code. “Show no mercy! Thou shall not dissent without grave punishment” in capitalist America.

Lynne was convicted in the post-911 generated climate of political hysteria. Bush appointee, Attorney General John Ashcroft, decided to make an example of her aimed at warning future attorneys that the mere act of defending anyone whom the government charged with “conspiracy to aid and abet terrorism,” could trigger terrible consequences.

On July 15 Judge Koeltl made the decision of his career. Known for his meticulous preparation in such matters, and already having enraged the powers that be with his “light” sentence of Stewart, he bent full tilt to the reactionary political pressures exerted on him by the court hierarchy. He had the option to stand tall and reaffirm his original decision. The “law” allowed him to do so. He could have permitted Lynne to
leave prison in less than two years, recover her health, and lead a productive life. His massively extended sentence, unless overturned, will likely lead to Lynne’s demise behind bars – a brilliant and dedicated fighter sacrificed on the alter of an intolerant class-biased system of repression and war.

Courage is a rare quality in the capitalist judiciary. For every defiant decision made, usually driven by a change in the political climate and pressed forward by the rise of mass social protest movements, there are thousands and more of political appointees that affirm the status quo, including its punishment of all who struggle to challenge capitalist prerogatives and power.

Lynne Stewart stands tall among the latter. We can only hope that the winds of change that are stirring the consciousness of millions today in the context of an American capitalism in economic and moral crisis keeps the movement for her freedom alive and well. The fight is not over! What we do now remains critical. Lynne’s expected appeal to the U.S. Supreme Court cannot be written off as absurd and hopeless. What we do collectively to free her and all political prisoners and to fight for freedom and justice on every front counts for everything!

Write to Lynne at:

Lynne Stewart 53504-054


150 Park Row
New York, NY 10007

For further information call Lynne’s husband, Ralph Poynter, leader of the Lynne Stewart Defense Committee 718-789-0558 or 917-853-9759

Send contributions payable to:

Lynne Stewart Organization
1070 Dean Street
Brooklyn, New York, 11216

The Struggle in Kashmir: Not Crushed, Merely Ignored

The Government of India, including all the shades of parliamentary oppositionists, would like to pretend that the world must say nothing about Kashmir, except to parrot the Indian line that whatever happens is an internal matter of India. Progressive voices all over the world need to fight to break this Indian effort at silencing the protests by Kashmiris. We are pleased to reproduce, from the London Review of Books, Vol 32, No. 14, 22 July 2010, an article by the noted Pakistan born marxist activist Tariq Ali. We thank the LRB and Tariq Ali for permitting us to reproduce the essay. It was originally carried in http://www.lrb.co.uk/v32/n14/tariq-ali/not-crushed-merely-ignored as an online article, with the title that is given below.
For the LRB as a whole, readers can check out its website http://www.lrb.co.uk/

--Administrator, R.S.

Not Crushed, Merely Ignored

Tariq Ali on the recent killings in Kashmir

A Kashmiri lawyer rang me last week in an agitated state. Had I heard about the latest tragedies in Kashmir? I had not. He was stunned. So was I when he told me in detail what had been taking place there over the last three weeks. As far as I could see, none of the British daily papers or TV news bulletins had covered the story; after I met him I rescued two emails from Kashmir informing me of the horrors from my spam box. I was truly shamed. The next day I scoured the press again. Nothing. The only story in the Guardian from the paper’s Delhi correspondent – a full half-page – was headlined: ‘Model’s death brings new claims of dark side to India’s fashion industry’. Accompanying the story was a fetching photograph of the ill-fated woman. The deaths of (at that point) 11 young men between the ages of 15 and 27, shot by Indian security forces in Kashmir, weren’t mentioned. Later I discovered that a short report had appeared in the New York Times on 28 June and one the day after in the Guardian; there has been no substantial follow-up. When it comes to reporting crimes committed by states considered friendly to the West, atrocity fatigue rapidly kicks in. A few facts have begun to percolate through, but they are likely to be read in Europe and the US as just another example of Muslims causing trouble, with the Indian security forces merely doing their duty, if in a high-handed fashion. The failure to report on the deaths in Kashmir contrasts strangely with the overheated coverage of even the most minor unrest in Tibet, leave alone Tehran.

On 11 June this year, the Indian paramilitaries known as the Central Reserve Police Force fired tear-gas canisters at demonstrators, who were themselves protesting about earlier killings. One of the canisters hit 17-year-old Tufail Ahmad Mattoo on the head. It blew out his brains. After a photograph was published in the Kashmiri press, thousands defied the police and joined his funeral procession the next day, chanting angry slogans and pledging revenge. The photograph was ignored by the mainstream Indian press and the country’s celebrity-trivia-obsessed TV channels. As I write, the Kashmiri capital, Srinagar, and several other towns are under strict military curfew. Whenever it is lifted, however briefly, young men pour out onto the streets to protest and are greeted with tear gas. In most of the province there has been an effective general strike for more than three weeks. All shops are closed.

An ugly anti-Muslim chauvinism accompanies India’s violence. It has been open season on Muslims since 9/11, when the liberation struggle in Kashmir was conveniently subsumed under the war on terror and Israeli military officers were invited to visit Akhnur military base in the province and advise on counter-terrorism measures. The website India Defence noted in September 2008 that ‘Maj-Gen Avi Mizrahi paid an unscheduled visit to the disputed state of Kashmir last week to get an up-close look at the challenges the Indian military faces in its fight against Islamic insurgents. Mizrahi was in India for three days of meetings with the country’s military brass and to discuss a plan the IDF is drafting for Israeli commandos to train Indian counterterror forces.’ Their advice was straightforward: do as we do in Palestine and buy our weapons. In the six years since 2002 New Delhi had purchased $5 billion-worth of weaponry from the Israelis, to good effect.

Demonstrations against Indian security forces escalated in early June this year when it was revealed in the extra-alert Kashmiri press that three young men – Mohammed Shafi, Shahzad Ahmad Khan and Riyaz Ahmad – had been executed in April by Indian army officers. A colonel and a major were suspended from duty, a rare enough event, suggesting that their superiors knew exactly what had taken place. The colonel claimed that the young men were separatist militants who had been killed in an ‘encounter’ near the Line of Control (the border between Indian-controlled and Pakistani-controlled Kashmir). This account is regarded by local police as pure fiction.

An Amnesty International letter to the Indian prime minister in 2008 listed his country’s human rights abuses in Kashmir and called for an independent inquiry, claiming that ‘grave sites are believed to contain the remains of victims of unlawful killings, enforced disappearances, torture and other abuses which occurred in the context of armed conflict persisting in the state since 1989. The graves of at least 940 persons have reportedly been found in 18 villages in Uri district alone.’ A local NGO, the International People’s Tribunal on Human Rights and Justice in Indian-Administered Kashmir (IPTK), states that extrajudicial killings and torture are a commonplace in the valley and that Western institutions don’t even try to do anything about this for fear of damaging relations with New Delhi. The figures provided by the IPTK are startling. It claims that the Indian military occupation of Kashmir ‘between 1989-2009 has resulted in 70,000+ deaths’. The report disputes claims that these killings are aberrations. On the contrary, they are part of the occupation process, considered as ‘acts of service’, and leading to promotion and financial reward (bounty is paid after claims made by officers are verified). In this dirty and enduring conflict, more than half a million ‘military and paramilitary personnel [more than the number of US soldiers in Iraq and Afghanistan combined] continue to act with impunity to regulate movement, law and order across Kashmir. The Indian state itself, through its legal, political and military actions, has demonstrated the existence of a state of continuing conflict within Indian-administered Jammu and Kashmir.’

Public opinion in India is mute. The parties of the left prefer to avoid the subject for fear that political rivals will question their patriotism. Kashmir is never spoken of, and has never been allowed to speak. With its Muslim majority it wasn’t permitted a referendum in 1947 to determine which of the two countries it wished to be part of. In 1984, when Indira Gandhi was the Indian prime minister, I asked her why she had not taken advantage of the birth of Bangladesh in 1971 (when Kashmiris had watched with horror how the Pakistan army treated their coreligionists) and allowed a referendum. She remained silent. I pointed out that even Farooq Abdullah, the chief minister of Kashmir, was convinced that India would win if a democratic election were held. Her face had clouded. ‘He’s completely untrustworthy.’ I had to agree, but her refusal to contemplate the Kashmiri self-determination promised by her father, Jawaharlal Nehru, was troubling. These days the very suggestion seems utopian.

The Abdullah dynasty continues to hold power in Kashmir and is keen to collaborate with New Delhi and enrich itself. I rang a journalist in Srinagar and asked him about the current chief minister, Omar Abdullah, a callow and callous youth whose only claim to office is dynastic. ‘Farooq Abdullah,’ he told me, ‘is our Asif Ali Zardari when it comes to corruption. Now he’s made his son chief minister so that he can concentrate on managing his various businesses.’ The opposition isn’t much better. Some Kashmiris, the journalist said, call Mirwaiz Umar Farooq, the effective leader of the opposition, and his cronies ‘double agents. That is, they are taking money from Pakistan and India.’ He is the 12th ‘mirwaiz’, the self-appointed spiritual leaders of the Muslims in the Kashmir Valley, and is adept at playing both sides. ‘Mirwaiz’s security outside his house is provided by the Indian state,’ a friend in Srinagar told me, ‘his wife is Kashmiri American, he lives very comfortably (without any source of income) and he is engaged in secret talks with India, news of which is constantly leaked. Furthermore, he also makes an annual pilgrimage to Pakistan to keep that channel open as well. He hangs out with “separatists” in Kashmir who are open to being used by both India and Pakistan, for a good price of course. The Indian authorities do not have to do much to crush Kashmiris while there are people like Mirwaiz. So, all in all, our leadership is working against us. India has always used this to its advantage.’

The Zardari government is silent on the issue of Kashmir and there has been little media reaction in Pakistan to the recent killings. For the ruling elite Kashmir is just a bargaining counter. ‘Give us Afghanistan and you can have Kashmir’ is the message currently emanating from the bunker in Islamabad. Zardari, it’s worth recalling, is the only Pakistani leader whose effigy has been burned in public in Indian Kashmir (soon after becoming president he had seriously downplayed Kashmiri aspirations). The Pakistani president and his ministers are more interested in business deals than in Kashmir. At the moment this suits Washington perfectly, since India is regarded as a major ally in the region and the US doesn’t want to have to justify its actions in Kashmir. Pakistan’s indifference also suggests that Indian allegations that recent events in Kashmir were triggered by Pakistan are baseless. Pakistan virtually dismantled the jihadi networks it had set up in Kashmir after the 1989 withdrawal of Soviet troops from Afghanistan not long after 9/11. Islamabad, high on the victory in Kabul, had stupidly assumed that they could repeat the trick in Kashmir. Those sent to infiltrate Indian Kashmir were brutal and mindless fanatics who harmed the Kashmiri case for self-determination, though some young people, tired of the patience exhibited by their elders, embraced the jihad, hoping it would bring them freedom. They were wrong.

As Indian politicians stood on the battlements of the Red Fort in Delhi to celebrate Independence Day in August 2008, Kashmiris began a mass campaign of civil disobedience. More than a hundred thousand people marched peacefully to the UN office in Srinagar. They burned effigies, chanted ‘Azadi, azadi’ (‘freedom’) and appealed to India to leave Kashmir. The movement was not crushed. It was merely ignored. Nothing changed. Now a new generation of Kashmiri youth is on the march. They fight, like the young Palestinians, with stones. Many have lost their fear of death and will not surrender. Ignored by politicians at home, abandoned by Pakistan, they are developing the independence of spirit that comes with isolation and it will not be easily quelled. It’s unlikely, however, that the prime minister of India and his colleagues will pay any attention to them. And just to show who’s master, the Indian army flag-marched through the streets of Srinagar on 7 July in an awesome show of strength.

8 July

The dead are:

11 June: Tufail Ahmad Mattoo, 17, killed in teargas fire in Srinagar.

19 June: Rafiq Ahmad Bangroo, 27, beaten by members of the Central Reserve Police Force near his home in old Srinagar on 12 June, died of his injuries.

20 June: Javed Ahmad Malla, 26, died when mourners, returning from Bangroo’s burial, attacked a CRPF bunker, causing its occupants to open fire.

25 June: Shakeel Ganai, 17, and Firdous Khan, 18, killed when the CRPF fired at protesters in Sopore.

27 June: Bilal Ahmad Wani, 22, died following CRPF fire in Sopore.

28 June: Tajamul Bashir, 20, killed in Delina; Tauqeer Rather, 15, killed in Sopore.

29 June: Ishtiyaq Ahmed, 15, Imtiyaz Ahmed Itoo, 17, and Shujaat-ul-Islam, 17, died after being shot by police in southern Anantnag.

5 July: Muzaffar Ahmad Bhat, 17, died in CRPF custody in Srinagar.

6 July: Fayaz Ahmad Wani, 18, shot by the CRPF during Bhat’s funeral procession in Srinagar; Fancy Jan, 25, the first woman to die, killed when a bullet hit her as she watched events from a window in her house; Abrah Ahmad Khan, 16, killed during protests over Wani’s death.

An Appeal to join in the Candle Light Protest in Kolkata from Concerned Citizens for Kashmir

Tufail Mattoo (17)  
Javid Ahmad Maila (18) 
Shakeel Ahmad Ganai (14) 
Firdous Ahmad Kakroo (17) 
Asif Hassan Rather (9) 
Ishteyaque Ahmad Khanday (15) 
Imtiyaz Ahmad Itoo (17) 
Muzaffar Ahmad Bhat (17) 
Abrar Ahmad (17) 

These are some of the twenty or so civilians killed by the security forces in the past month. The home minister has come out with statements like: Parents should ensure that their children remain indoors. It is the responsibility of parents,” He further said that the purpose of moving in the Army was to “serve as a deterrent.” The Army would be in Kashmir “as long as it is necessary” to deal with the situation there. Fingers have been pointed at terrorist groups as well as the half-hearted attempts of the ruling NC state government to control the situation. But it is increasingly clear that spaces for civil dissent in Kashmir are few and continually shrinking. The armed forces have been used to crush all forms of civilian dissent in Kashmir and the protests and protesters in the valley are always criminalised more than anywhere else in the country.

No one from the central government has come out with a statement expressing grief at the loss of so many young lives and consoling the bereaved families. And all the while the civilian death-toll is mounting and will continue to do so as long as the Armed Forces (Jammu and Kashmir) Special Powers Act, 1990 (AFSPA)—which gives army officers the power to open fire on protesters and anyone else they decide is a potential lawbreaker whilst granting all personnel impunity from prosecution under civil law—remains in force in Kashmir.

Whatever our separate and individual takes on azaadi and armed insurgency, there cannot be any doubt that these killings of unarmed civilians—mostly angry teenagers—by the armed forces in Kashmir are gross violations of human rights and civil liberties. We must come together to

  1. express our solidarity with the families of those who have been killed in the recent events and also with those who are protesting against the continued presence and the misconducts of the armed forces in the valley
  2. strongly condemn the violence and the role of the security forces
  3. insist that the Government of India and the state government take immediate action to prevent further loss of life and property and initiate an impartial investigation into the recent killings
  4. demand the immediate repeal of the Armed Forces (Jammu and Kashmir) Special Powers Act, 1990 (AFSPA)
  5. demand  immediate steps for the gradual demilitarization of the valley with troops confined to the border areas

A candle light protest will be held on July 24, 2010 in front of Academy of Fine Arts between 5pm and 8 pm to protest and denounce the killings and human rights violation in Kashmir in the past weeks. We invite you to come and join the vigil and voice your protest. Please forward this appeal to others. We are also sorry about crosspostings, if there are any.

We would also request you to get in touch with us by July 16, 2010 to let us know if you would like to support and participate in the vigil.



Aniruddha, Debjani, Madhura, Parjanya

(on behalf of Concerned Citizens for Kashmir)

Contacts: Aniruddha: 9836412779
Debjani: 9674063020
Madhura: (0)9582318323

CONCLAT: an undeniable setback

Ernesto Herrera *

It was a stirring call. The Working Class Congress (CONCLAT) in Brazil proposed to unify, in a new classist centre the trade-union, student and popular currents; all that are resisting the Lula government’s and the bosses’ offensive. And, at the same time, confront the trade-union centres (CUT, Força Sindical, etc.) that have yielded to the government and the capitalist order.

The CONCLAT was held on 5 and 6 June in the city of Santos in Brazil.   The massive turnout reflected the expectations created: 4,000 participants and 3,200 delegates, about 350 unions, associations, movements and associations representing, according to organisers, more than 3 million workers. In the previous months, 926 grass-root assemblies had gathered around 20,000 workers to discuss the various documents, to make proposals and to choose delegates.

Numerous foreign delegations turned up from 26 countries in Latin America and the Caribbean, United States, Europe and Japan. They brought in to CONCLAT the essential international dimensions. Particularly moving, was the presence of Sotiris Martalis from the teachers’ union in Greece, belonging to the ADEY (Confederation of Public Sector Trade Unions), who recounted the struggle of the Greek workers challenging the brutal capitalist attack on wages, employment, and retirements.

Power relations
For the thousands of participants involved with the unification, the CONCLAT was a kind of synthesis of their diverse experiences. It was an act of translating these experiences to an organisational and programmatic level and the beginning of a trade union and popular restructuring. Albeit in a defensive situation, it is built from an opposition to the neoliberal agenda of the employers’ government headed by Lula. It expressed, on the other hand, efforts to unify the struggles, wage demands and seek consensus on issues that divided the class-conscious and anti-capitalist camp.

Although still a vanguard phenomenon, a minority of the whole working class and without the presence of a crucial sector of the exploited, such as landless peasants (mostly organized in the Movimento dos Trabalhadores Sim Farm Terra-MST), this process of unification reflected the social energy accumulated in the significant layers of the popular movement.

In fact, the CONCLAT expressed at a certain level, the emergence of a new unionism. A trade union which, in turn, binds more concrete demands of the working masses in all the mobilisations of the exploited and oppressed by an anti-capitalist perspective. Hence, the emergence of CONCLAT initiated the possibility (and only that) for an alternative to contest the global power relations.
Since it attempted to build an instrument to modify (or to endeavour to modify) the power relations between class-conscious trade-union camp and the trade-union councils subordinated (politically and materially) to the capitalist state apparatus.   On Thursday June 3, a note in the daily Folha de Sao Paulo revealed the scandalous price of this subordination: the trade unions allied with the government, had received since 2008, the sum of 228 million reais ($ 126.3 million) as “reimbursement” of the “union tax.”  
The CONCLAT faced the challenge to overcome – in the benefit of the working classes and oppressed - the “bankruptcy of militant and independent left-wing union project,” that started with the major workers’ strikes in the years 1978-1980 and the establishment of the CUT (Central Unica dos Trabalhadores). Therefore, the challenge demanded a development of the construction of a class-conscious alternative with decisive impact on key sectors of the working class. One delegate, from the education sector, summed up the feelings of the common activists: “refound class unionism.”

However, this opportunity was diluted by the events of the Congress. What weighed much more, for the Intersindical and Conlutas union apparatus was the “rightness” of their arguments and the “victory” of their proposals. They incited their troops. They heard nothing. They imposed - from the gallery and discussion groups – the logic of competition. They gave priority to the dispute over the balance of power within the CONCLAT....

Unfortunately, the CONCLAT failed to secure the path of unity. In contrast, it ended up producing a serious rupture. And this “interruption of the process of unification” - that was growing from the World Social Forum of Belem (January 2009) - is, from every point of view, a heavy setback. Unable to conceal or disguise, it was enough to see the bitter, desolate and angry expressions of workers and popular social activists - who came with thousand sacrifices from throughout the country - to perceive the consequences of failure. Suddenly, the contagious hope of the previous days had gone.

Majority leaderless
The call to CONCLAT sparkled in the flags and T-shirts: “Let’s unite to strengthen the fight.”  This simple slogan raised the tasks: the Congress to overcome the fragmentation of the trade union left, the new centre as a tool to organize the struggle against capital.

The different documents submitted  at the Congress contained significant convergence and divergence, for example, on the future functioning of the centre, proportionality, integration and powers of leadership. The same could be said about the analysis of the national situation: there was an “underlying tension” marked by the election campaign. In the Congress, the rivalry became apparent between those who supported the candidacy of Ze Maria of PSTU (Partido Socialista dos Trabalhadores Unificado) and those who supported Plinio de Arruda Sampaio-PSOL (Partido Socialismo e Liberdade) as two distinctly different ways  to express the struggle and the interests of workers against the two bourgeois parties (PSDB and PT). The claim of “responsibilities” around the non-realisation of the Left Front was a constant during the Congress.

Obviously, a candidature presented under the slogan of the Left Front, would have created better conditions for altering the false “centre-left/centre- right” polarisation. The sociologist Ricardo Antunes described this as a danger of “Americanisation” of the Brazilian political system.

Anyway, there was a basic consensus on the situation of trade union and popular struggles, especially regarding the program that further encouraged the possibility of unification.

There was no agreement on two central questions: 1) the nature of the centre, 2) the name of the new centre. In eleven meetings of the Commission for the Reorganisation / Coordination of the Centre these differences were not resolved. They agreed to go by the criterion of “workers’ democracy”, i.e. voting in Congress. All of us now know the outcome of that decision. Apparently very democratic indeed.

A clear majority of delegates voted in favour of the Conlutas proposal: a trade union, peoples’ and student centre. Undoubtedly, a winning formula in tune with the plurality of social groups involved in the trade-union and popular reorganisation. Intersindical proposed a trade union that articulated in a National Forum with the student movement. Following the proposal from Conlutas, the same majority voted for the integration of students in the leadership of the new centre.

As for the name, a thin majority (impossible to quantify the extent as the votes were not counted), forced the name “Conlutas-Intersindical/Trade –Union and Popular Centre.” The delegates from Intersindical (who already denied the use of their name in the name of the new centre), MAS  and Unidos pra Lutar  rebelled against the “outrage” and left the Congress. The unification process was “interrupted.”

The “restoration” of Congress - after the withdrawal of the delegates from Intersindical / Unidos/ MAS deepened the split. The majority that finally formed the “new trade union confederation is mainly Conlutas. Other currents to accompany were Movimento dos Trabalhadores Sim Teto (MTST) Terra Livre (Popular Movement of the cities and the villages); Movimento Popular pela Reforma Agrária (MPRA) and, surprisingly, the Movimento Terra, Trabalho e Liberdade (MTL), an organisation that integrates an opportunistic fraction of PSOL.  

The formalities say that the Congress decided. There was a majority (which is not disputed) and a minority. There was a “democratic legitimacy.” Already without the atmosphere of enthusiasm and with little more than half the delegates in the hall, the formation of the new centre was announced and the integration of a “Provisional National Executive Secretariat” of 21 members agreed by consensus with ample pre-eminence of Conlutas.  It shall be responsible for “routing decisions” and to re-establish relations with the section who walked out of the Congress.

The main forces have commented on the result. According to Conlutas: “What could have been a great victory for the reorganisation process, unfortunately, turned into a defeat by the decision of the Intersindical/Unidos/MAS walking-out from the Congress after losing the vote on the name of the new entity.” For Intersindical: “Unfortunately, we did not want what happened! We had to interrupt the process of setting up the centre. The debate over the construction of the new centre (nature, politics and name) revealed the utter lack of willingness on the part of most Conlutas, to build a synthesis of divergent views. It preferred to carry out the opinion of the majority (small and casual) of delegates in Congress to impose a single vision.”

Almost everyone agrees to continue exploring ways of unity. Although the prevailing idea is that the break is “irreversible” if the majority maintained their positions and the methods, which led to ultimate failure. It is attributed, of course, to the “responsibility” of Conlutas and the political force that hegemonises it: the PSTU.
One does not discover anything new to say that the PSTU have a decisive bearing on Conlutas and in many social struggles. It is impossible to understand the genesis and development of Conlutas without considering the boldness and the active engagement of activists and union leaders PSTU in this process. Therefore, the majority in Conlutas adheres to PSTU and it has unquestionable political legitimacy.

It is also true that there is a responsibility of Conlutas/PSTU in the CONCLAT failure. Because of the “abuse” of its majority? Because of the “knocking down” of the minority? It would be too unilateral and sectarian explanation. The drama lies in not being able to exercise leadership over anyone else apart from the majority obtained in CONCLAT. A leadership that transcended the borders of Conlutas / PSTU, i.e. beyond its defined field of membership and influence already achieved. A Leadership that, ultimately, promote and ensure both the agreements and consensus. Essential in any process of unification - as it opened the CONCLAT- involving very different forces, traditions, and practices; a process which should secure the maturity and credibility of a leadership, a capability that, in addition, came under consideration of broad sections of the society which came to meet in the CONCLAT.

The big mistake was not mended and the attempt was not to be a true leader. since from the beginning of Congress there were sniffs of a climate of rupture in the various tendencies of Intersindical (which in turn responded to the fractions of PSOL) that feared being “annexed” by Conlutas and landing into the orbit of PSTU (after votes on the nature and the name of the new centre, there was a stampede of delegates from Intersindical, forcing its leadership to withdraw). Also, because it was well-known that major sections of Intersindical (not involved in the CONCLAT) were negative to unification with Conlutas: why “close the doors” to left-wing currents in the CUT, which are critical of the subordination to the Lula government.
“Political autism“, as one grassroots delegate said? Difficult to judge for a foreign “observer”. However, there is the perception that the “Staff” of Conlutas / PSTU should not force the vote on the name of the new centre. Not only because it did not reflect the trade-union and popular reorganisation process, but because they did not respect the sensitivities and pluralities represented in the CONCLAT.

Before the CONCLAT (3 and 4 June) there was the Conlutas Congress. It was supposed to be a Congress of their “dissolution”. But it was not. The 1,800 delegates, who participated intensely, both in discussions and vote, ended up self-affirming the continuity of Conlutas. Was there a final mandate in defence of “identity?” Two days later, at the time of breaking the impasse in the CONCLAT, there was neither a consensus, nor were there “concessions.” The leadership of Conlutas / PSTU took refuge in a closed centralism for a reorganization process that went beyond their militant forces and their field of influences.
The efforts and last-minute negotiations were unsuccessful. After the vote, hundreds of delegates left the Congress. Mostly Intersindical and many of Conlutas with the feeling that they had lost an invaluable opportunity.

* Member of the Colectivo Militante  (Uruguay), editor of Correspondencia de Prensa.


i. The CONCLAT was convened and organized by Conlutas (National Coordinaçào Lutas), Intersindical, MAS (Movimento Avançando Sindical)); MTST (Movimento dos Trabalhadores Sim Teto) MTL (Movimento Terra, Trabalho e Liberdade) and the Pastoral worker ( PO - Metropolitana de Sao Paulo).
ii.  The notable foreign trade union delegations were: SUD-Solidaires, unitaire et démocratique (France), National Union of Railway Companies (Japan) Labor Notes (USA) and the, Classist, Unitary, Revolutionary and Autonomous Current (Venezuela). Among the international political organisations were: Batay Ouvriye (Haiti); New Anti-Capitalist Party (France) Red Stream (Spanish State) and the Movement for Socialism (Switzerland). In addition, there were numerous groups in Latin America and the Caribbean. On Monday June 7, foreign delegations held a meeting to coordinate Intersindicalnational solidarity campaigns.
iii.  The six trade unions legally receive state funds. All of them are campaigning for Dilma Rousseff, the PT presidential candidate. CUT (trade union wing of the PT) and Força Sindical (divided PCB bureaucracy and recycled during his time by Collor de Mello to curb the “wild unionism” of the CUT) are those that have most members.
iv. The “union tax” was created by the government of Getulio Vargas in 1940. Today is mandatory and is paid by all workers, whether unionized or not. It is the equivalent of a day’s wage and is deducted every March. It is also charged to employers. The two central majorities CUT and Força Sindical received a sum of 50 million reais (approximately $ 29 million) in 2010 only. The “union tax” that the government collects, is distributed among the central trade union federations and business associations since 2008. It is currently the main source of income for the unions. CUT denounces it as a “spurious resource”, but it collects the same nevertheless.
v.  All these are available at sites and Intersindical Conlutas: http://www.conlutas.org.br/site1/default.aspwww.Intersindicalsindical.inf.br
vi.  The student representation in the CONCLAT was in charge of ANEL (Asambleia Nacional dos Estudantes – Livre), composed mostly of young militants of PSTU who broke with UNE (União Nacional dos Estudantes) dominated by political forces supporting the Lula government, mainly PCdoB and PT.
vii.  The MAS (Movimento Avançando Sindical), of Stalinist origins, is motivated by the Luís Carlos Prestes Communist Current.
viii.  Unidos pra Lutar is the trade union front of the Corrente Socialista dos Trabalhadores (TSA), a Trotskyist organization integrated in PSOL. Until CONCLAT was part of Conlutas. Its own document in some issues was opposed to the majority Conlutas proposals, particularly with regard to the character and the name of the new centre.
ix. This fraction of PSOL is composed of the Movimento Terra, Trabalho e Liberdade (MTL), Movimento Socialista Esquerda (MES) and former senator Heloisa Helena. This fraction is proposing that the PSOL support the presidential candidacy of Marina Silva (Green Party). They did not support the choice of Plinio de Arruda Sampaio, PSOL presidential candidate. It accepts the “donations” from private companies in election campaigns.
x. The Provisional National Executive Secretariat consists of three militants of Terra Livre, three from MTL, 3 from MTST and 12 from Conlutas.
xi.  The full version of the two statements (in Portuguese) is in Conlutas and Intersindical websites.

Suggested paths to 21st century socialism in Venezuela

Eric Toussaint[2]


Reduce dependency on hydrocarbons and on the United States

One of the challenges that several previous governements have had to face, just as Chávez’ government must, is to diversify the productive apparatus in order to shake off the country’s extreme dependency on hydrocarbons (this is also true for the majority of the big oil-exporting countries). It was precisely to this end that, in the 1960s, a company such as SIDOR, the iron steel corporation, was created. Later, during the 1980s and 1990s, the neo-liberal governments privatized several public companies like SIDOR and decided to rely on foreign investments to diversify the economy. This was a failure.


In recent years, the Hugo Chávez government has in its own way been endeavouring to diversify the production infrastructure:

1. development and reinforcement of a steel and iron pole by carrying out a policy of import substitution (for instance, Venezuela is going to produce the pipes it needs for its pipelines whereas, up to now, they have been imported; with the help of the Chinese, Venezuela is going to produce railway equipment and re-develop its rail network);

2. support for local food production so as to come as close as possible to a situation of food sovereignty, while currently almost 90% of food products consumed in the country are imported (legacy of a decade-long use of oil revenues to import whatever Venezuela needed) ;

3. development of a  petrochemical industry;

4. improvement of the production and supply of electricity, produced in the great majority from hydraulic energy (and fortunately not from oil). In this regard, contrary to the official position, Venezuela must avoid getting into electricity production from nuclear power;

5. nationalization of the cement industry so as to develop the government’s housing construction policy.


Venezuela is also seeking to reduce the share of exports to the United States,[3] its main buyer of hydrocarbons, by trying to increase its supplies to China (according to some goverment sources, there is hope that China will be buying as much as the United States by 2014, which seems  a difficult objective to achieve).


Land policy

A land reform has been carried out,[4] cooperatives and small farms have been granted substantial subsidies, but the initial situation was very delicate. The share of agriculture in the country’s GDP is very low[5] and, with some important exceptions (for instance the regions of big market-garden production in the Andes[6]), Venezuela is one of the countries where the system of farmers’ smallholdings has been notably weakened due to the importing model that has prevailed for decades.


How can a local farming population be reconstituted so as to ensure food sovereignty for a population that will reach 30 million inhabitants in the coming years? The problem is admittedly a difficult one to solve. To this end, the State needs to implement a vast package of incentive measures such as: a substantial improvement in the quality of public services in rural areas so as to reduce rural exodus; support for family farming and other traditional forms of agricultural production without favouring cooperatives exclusively;[7] the development of a public retail network for farmers’ production, guaranteeing stable outlets and prices high enough to encourage producers and save them from the clutches of the private networks that impose their prices on producers and secure excessive profit margins for themselves.

Michael Lebowitz made a number of proposals regarding farming policy in Venezuela that should be implemented to improve the situation: “taking into account the existing contraband due to an overvalued bolivar and the diversion of goods through the black market, the solution does not lie in subsidizing by supplying free inputs such as means of production, nor in direct monetary subsidies to agricultural production (except in cases where new production facilities are built). Why? Because, given the circumstances, there is no kind of control ensuring that products go where they are needed – especially when control or monitoring mechanisms, which involve high transaction costs, are lacking.

Therefore to ensure that subsidies lead to a real increase in food supply on the national market, and at decent prices, the best form of subsidizing is through a State agency that buys products at a set price. This State agency can offer the producers a price that encourages production and can later make sure that the items are sold to the population via the Mercal network at prices lower than those paid to the producers.”[8]

The Venezuelan government’s debt policy

The public debt burden in percentage of GDP has been reduced over the last few years but one has to emphasize that the Chávez government is not initiating a comprehensive audit of the public debt, whereas it promised to do so on several occasions.[9]

Besides, one can only wonder about the appropriateness of taking on new loans when the price of the barrel of oil was high and when liquid assets were abundant. And yet, in 2006 PDVSA went into debt for 12 billion dollars by issuing bonds on the international financial markets. How can this decision, which was not discussed in the National Assembly, be justified? With the decline in the price of the oil barrel since July 2008 (even if the current price – between 70 to 80 dollars a barrel during spring 2010 – keeps Venezuela on the safe side for the time being), don’t the repayments by the PDVSA put a strain on its budget and excessively reduce its liquid assets? Why go into debt and transfer interests to the international (or national) private financial players if one has enough cash assets not to be forced to borrow money? These questions are unfortunately not being answered.


One should note that Chávez emphasizes the country’s endogenous development, which he defines as “self-centred, based on domestic resources and an integral part of the strong comeback of the national dimension.” Reducing PDVSA's external debt should be an interesting way of developing this definition.

Other steps to be programmed


One of the solutions that need to be implemented so that the State (instead of the present private banking sector) can retrieve a substantial share of the money it distributes (or spends) consists of transferring to the public sector (nationalizing) the greater part or the whole of the capitalist banking sector of Venezuela.[10] The State will then be able to re-invest part of the money it distributes (derived from its oil income) into the economy in the form of social spending or productive investments, in order to generate a virtuous circle of accumulation and the development of a public sector of the economy, as well as other kinds of ownership to be supported and strengthened (small private ownership, cooperative ownership, traditional forms of property among indigenous communities, etc.).


A second measure could consist of State control on foreign trade, so as to prevent a great part of the revenues it generates from being diverted towards capitalist accumulation and/or towards other countries through outflow of capital. A series of incentives of different kinds (taxes, subsidies, priorities in State orders…) is also needed to support the non-capitalist sector of the economy (obviously including small private ownership).[11]


Citizens’ and workers’ control to avoid 20th-like socialism

But what is absolutely essential is to set up mechanisms aimed at avoiding two major pitfalls: 1) the monopolization of decision-making processes by the State bureaucracy and

2) the emergence of a new bourgeoisie from within Chavism, which is already dubbed  “bolibourgeoisie” (= the Bolivarian bourgeoisie, the section of the Chavist leaders who take advantage of their position to begin accumulating capital). [12]


Among other mechanisms, let us mention: establishing limits to the range of wages (for instance a scale from one to six) by reducing the highest wages and significantly raising minimum wages as well as other wages up to the average wages;  forcing agents and civil servants to make an annual declaration of global incomes (salaries and other earnings and incomes) and personal wealth (since the accumulation of capital by bureaucrats is more often done through backhanders which do not appear in income statements whereas they do in statements of personal wealth); forcing citizens to declare their various bank accounts in the country and abroad (lifting bank secrecy); substantially increasing proportionality in income tax.


Improving the training of managers in public companies is also vital, because nationalizations require the creation of a recruitment pool of managers with high technical competence and a high level of political, social and ethical training. To step up the pace of nationalizations, a pool of managers has to be created, while simultaneously developing, as mentioned above, a policy of worker and citizen control. Unless this is done, there is the risk of creating public companies that are inefficient, and even corrupt.


The essential and certainly the most efficient remedy is to implement a policy of workers’ and citizens’ control over the accounts and running of companies and public institutions. It would enforce transparent management (so as to prevent embezzlement, squandering, use of the resources of companies or institutions for projects which are not socially or environmentally justified) through a comprehensive audit policy in which workers and users of services must actively take part.

There is also a need for appropriate transition from workers’ control to company self-management (while maintaining an external control). The whole battle for workers’ control, for citizen control (which I also call control by users), for self-management, is part of the building up of grassroots popular bodies, such as the communal councils. The right forms still remain to be found so that this construction of grassroots entities is not restricted to a fragmented view. This raises the question of setting up a national federation of control organizations through which popular power can become a reality.



Translated by Stéphanie Jacquemont and Judith Harris, in collaboration with Francesca Denley and Christine Pagnoulle


[1] The first part of this series ‘Bolivarian Venezuela at the crossroads’ was posted on the CADTM website on 14 April 2010 under the title ‘Venezuela. Nationalization, workers’ control: achievements and limitations’ http://www.cadtm.org/spip.php?page=imprimer&id_artice=5587, the  second part was posted on 18 June 2010 http://www.cadtm.org/Debate-and-contradiction-in-the (see also: http://www.europe-solidaire.org/spip.php?article17417 ) under the  title ' Debate and contradiction in the PSUV (United Socialist Party of Venezuela)’; the third part was published on 24 June 2010 under the title “The Venezuelan economy: in transition towards socialism?”

[2] Eric Toussaint, Doctor in Political Science (University of Liege and University of Paris VIII), is president of CADTM Belgium (Committee for the Abolition of Third World Debt, www.cadtm.org ). He is the author of A diagnosis of emerging global crisis and alternatives, VAK, Mumbai, India, 2009, 139p; Bank of the South. An Alternative to the IMF-World Bank, VAK, Mumbai, India, 2007; The World Bank, A Critical Primer, Pluto Press, Between The Lines, David Philip, London-Toronto-Cape Town 2008; Your Money or Your Life, The Tyranny of Global Finance, Haymarket, Chicago, 2005.

[3] According to the Instituto nacional de estadísticas, in 1999, the United States accounted for 47.36% of Venezuelan exports, and imports from the US amounted to 40.61% ot the total imports of the country. In 2007, these percentages respectively decreased to 52.4% for exports and 25.8% for imports.

[4] At the end of 2008, 2,675,732 hectares had been recovered from latifundias (large estates) and farmers had been given title deeds and contracts for a total of 1,862,247 hectares.

[5] The agricultural sector accounts for barely 4.39% of GDP whereas in Colombia it accounts for 12.1%. The Latin American average is 6.22% of GDP.

[6] See Alexandra Angeliaume and Jean Christian Talet, « Mutation maraîchère et accompagnement institutionnel dans les Andes vénézuéliennes (1950-2007) » chapter 4 of the second part in Olivier Compagnon, Julien Rebotier and Sandrine Revet (eds), Le Venezuela au-delà du mythe. Chavez, la démocratie, le changement social, Editions de l’Atelier/Editions Ouvrières, Paris, 2009, 238 pages

[7] The impact of the creation of the many farming cooperatives (and other cooperatives) has been rather mitigated in Venezuela (as has been the case for other countries that prioritized cooperatives over individual family farming).

[8] Michael Lebowitz, “De los subsidios agrícolas a la soberanía alimentaria”, 2 February 2008, 7 pages.

[9] Hugo Chávez announced the launching of a debt audit when he met a hundred or so delegates of social movements from all over the world in Januray 2006 after the 6th edition of the World Social Forum, a polycentric forum held in Caracas, Bamako and Karachi. I attended this meeting, which was entirely broadcast live on public television. Chávez also made a commitment to audit the debt in late 2008, during an ALBA meeting.

[10] A first measure in this direction was taken in 2009 when Banco de Venezuela was nationalized.

[11] In this respect, see Victor Álvarez’s proposals in the final part of his document mentioned earlier.

[12] Roberto López, a professor at the University of Zulia, criticizes a process “where private company sectors, which are not necessarily those trying to overthrow the government, but private sectors allied to the Bolivarian bureaucracy, have become multimillionaires during this period. An analysis should be made of these private groups and of their relationship with the economic assets of many leaders and prominent figures of the process.  There seems to be a new Bolivarian bourgeoisie associated with business circles. For instance, a fact I heard about almost directly concerned subcontracting companies that had just been nationalized, expropriated, in the region of the Eastern Coast of the Lake and in almost all of them there were leaders who had participated in the coup (the military coup d’Etat of April 2002), in the oil lockout, and all were associated with PSUV leaders, revolution leaders, members of Parliament, Bolivarian governors, etc. ” See http://www.aporrea.org/actualidad/n136767.html

Bolivarian Venezuela at the crossroads The Venezuelan economy: in transition towards socialism?

(Part 3)[1]


Eric Toussaint[2]

The capitalist sector is growing faster than the public sector and is still predominant in Venezuela’s economy despite the nationalizations.

The share of the private sector (greatly dominated by the capitalist sector[3]) in Venezuela’s gross domestic product has grown from 64.7% in 1998 (before Hugo Chávez was elected president) to 70.9% in the third quarter of 2008.[4] Although the government has nationalized a significant number of large companies in the electricity, telecommunications, steel, food, cement and banking sectors, the capitalist sector has recorded more rapid growth than the public sector, which explains that its relative share in GDP has increased whereas the share of the public sector has decreased (from 34.8% in 1998 to 29.1% in 2008).[5]


This can be explained by the way the country’s oil income is used. The overwhelming majority of the Venezuelan State’s revenue comes from oil exports. The government massively uses the resources coming from oil to improve the living conditions of the poor majority of the population (as well as of the medium income brackets) in the fields of health (where results are impressive), education (also impressive), supply of low-priced basic products through the distribution and marketing channels Mercal[6] and Pdval[7] (staple food and other basic products for households), housing construction, the building of infrastructure and public transport (subway, train), wage increases in the civil service, increases in a large number of grants and social allowances, not to mention expenses in the field of culture and sports. It grants substantial subsidies for cooperatives, communal councils, etc. The result is clearly positive: the percentage of Venezuelans below the poverty line was reduced by half between 2003 and 2008, from 62.1% to 31.5% of the population. As for the percentage of people in extreme poverty, it was reduced by two-thirds, from 29% in 2003 down to 9.1% in 2008;[8] illiteracy dropped sharply, the level in training improved, access to free healthcare increased greatly, mass consumption rose.


But to a large extent the capitalist sector is also benefiting from government spending because it is still dominant, by a long way, in the banking sector, in trade and in the food industry. The extra money that goes to the people and comes from public spending ends up in the capitalists’ pockets because it is in the capitalist banks that individuals (and also cooperatives, municipal councils, municipalities and many other public entities) deposit their money. It is the capitalist banks that issue consumer credit facilities in the form of credit cards, and support a growing share of the consumption (and charge high interest rates for this). It is the capitalist companies of the food industry that produce or market most of the food products consumed by the masses.  It is the capitalist import companies that bring from abroad the many imported products consumed by Venezuelans. The private retail chains still dominate trade even if Mercal and Pdval are significant players in supplying basic products. When the State nationalizes private companies that belong to the national capital, it is the local capitalists that receive buyout compensations from the State.

In brief, the capitalist sector continues siphoning off most of the money spent by the State to help the poor or middle-income sectors of the population.

According to a study[9] by Mark Weisbrot and Luis Sandoval that is in fact very favourable to the Chávez government, the private financial sector grew by 37.9% in 2004, by 34.6% in 2005 and by 39.2% in 2006, while the growth of the public sector (all sectors taken together)  was only 12.5% in 2004, 4.1% in 2005 and 2.9% in 2006.

As stated by Victor Álvarez : “During the previous mandate of President Chávez (2000-2006), most financial, fiscal, exchange rate incentives, most public spending, most technical assistance, etc., went to the existing production apparatus, fundamentally consisting of commercial companies, which reproduce a capitalist mode of production that is, paradoxically, the very one we want to overtake and transcend.”

We are thus far from the assertions made by the mainstream media, which see in the Chávez administration a rampant imposition of state control over the Venezuelan economy.


Gifts made to the banks

An additional issue, stems from the policy of overvaluation of the Venezuelan currency against the dollar. This question requires some explanation. Since 2003, companies that want to import goods and services have had to buy dollars from a state administration called CADIVI. This is a useful measure taken to fight capital outflow. The problem is that the exchange rate between the bolivar and the dollar overvalued the value of the former. It therefore exacerbated a perverse pattern: for a capitalist who has a large amount of bolivars, it is more profitable to change them for dollars which are sold cheaply by the State and import products from the United States or elsewhere than to produce them in the country. Thus the policy of an overvalued bolivar deterred productive investment and encouraged trade based on the frenetic import of goods[10] and sale of the same through the big private retail networks. These massive imports are in fact subsidized by the State since the State sells the private sector the cheap dollars it has accumulated through its oil exports.  Another point also needs to be examined: how this policy of an overvalued bolivar and a high level of imports influenced the inflation rate, which has been particularly high in Venezuela in recent years. This high inflation rate reduces the impact of the pay rises granted by the government.


One vicious example of this policy of an overvalued bolivar and of gifts made by the government to the private banks: the Venezuelan State bought debt bonds issued by Argentina in 2004-2005. The problem is that it sold part of these Argentine debt bonds, drawn up in dollars, to the private banks. These banks bought them with bolivars at the official overvalued exchange rate. What did some (in fact many) of them do with these bonds? They sold these Argentine debt bonds in the United States or elsewhere to obtain dollars. This allowed them to bypass the control imposed by the Venezuelan State over capital movements. Officially, they did not export capital; they only got Argentine debt bonds out of the country.

Since then, the State has kept on making gifts to private banks thanks to similar manoeuvres.  PDVSA and other public entities issue public debt bonds drawn up in dollars that are bought in bolivars by Venezuelan banks at the official exchange rate. Then these banks sell part of the bonds on the international market for dollars[11]. In brief, the State policy has two negative consequences: first, it permits capital flight in a circuitous but perfectly legal way; second, it encourages parasitic banking behaviour (buying of debt bonds) to the detriment of productive investment.


The conclusion that can be drawn is that although the State is trying to carry out a policy of endogenous development (i.e. designed  to meet the internal demand through greater domestic production), the way the oil money is redistributed, combined with the overvaluation of the bolivar, tends to strengthen the capitalist sector and its importing pattern.


In a speech given during the meeting of intellectuals organized by the CIM, the writer and lawyer Luis Britto aptly summed up the situation: “We live in a dual society, and in a fable I wrote I explained that if one tries to set up a mixed system with hens and foxes in one single henhouse, then the following week, there will only be foxes left, and then they will eat the farmer.”[12]



Dealing with the thorny question of exchange rates: the January 2010 devaluation

In January 2010, the government carried out a devaluation. What does this devaluation consist of? Two official rates were set: the first one represents a 21 percent devaluation of the bolivar against the dollar (instead of 2.15 bolivars, 2.6 bolivars are needed to obtain one dollar); the second rate represents a 100 percent devaluation (one has to pay 4.3 bolivars for one dollar instead of 2.15 bolivars). The first rate (2.6 bolivars per dollar) is in force for expenses considered to be vital or at least to be a priority: imports of food, medicines, technologies, equipment for industrial or agricultural production, imports made by the public sector, the payment of scholarships to Venezuelan students studying abroad, of pensions to retired people living abroad. The second rate (4.3 bolivars per dollar) is applied to imports of automobiles, beverages, tobacco, cell phones, computers, home appliances, textiles, chemical and metallurgical products, rubber, etc.


In the short term, this devaluation will increase the State’s tax revenues. The dollars that the State gets from oil exports will be sold for a larger amount of bolivars. This is certainly one of the main goals pursued by the government which has seen its tax revenues dwindle due to the impact of the international crisis on the country’s economy. But this does not mean that the Venezuelan State is going to win on all fronts. The repayment of the public debt, 67.8 percent of which is drawn up in dollars, will cost the government more. The Venezuelan bankers and other capitalists who bought debt securities drawn up in dollars will get richer once again.


Obviously there are other consequences: for the workers and all low income earners who receive this income in national currency, the devaluation means lower purchasing power: the cost of the products they consume will be higher because many products are imported or produced in the country with a large imported component. Importers, retailers, producers will pass on the additional costs to the retail price. This loss of purchasing power can only be limited or compensated if wages increase in proportion to the cost of living, which is not the case. On 1 May 2010 Hugo Chávez decreed a 15 percent increase in minimum wages and pensions but inflation reached 25 percent in 2009 and will probably be even higher in 2010.


This devaluation aims at other objectives in the longer term, but it would be risky to say whether they can be reached or not. Among these objectives, the most important one is certainly the promotion of import substitution. Since importing now costs 21 or 100 percent more (depending on the products imported), imports should decline and local producers should be in a better position for selling their production on the national market. Even better: the devaluation should convince them that it is profitable to produce products that were formerly imported. This could create a virtuous circle thanks to which the country could strengthen its industrial and agricultural base by replacing imported products with local ones.



Translated by Stéphanie Jacquemont and Judith Harris, in collaboration with Francesca Denley and Christine Pagnoulle

Next part: Suggested paths to 21st century socialism in Venezuela (Part 4)

[1] The first part of this series ‘Bolivarian Venezuela at the crossroads’ was posted on the CADTM website on 14 April 2010 under the title ‘Venezuela. Nationalization, workers’ control: achievements and limitations’ http://www.cadtm.org/spip.php?page=imprimer&id_artice=5587, the  second part was posted on 18 June 2010 http://www.cadtm.org/Debate-and-contradiction-in-the (see also: http://www.europe-solidaire.org/spip.php?article17417 ) under the  title ' Debate and contradiction in the PSUV (United Socialist Party of Venezuela)’

[2] Eric Toussaint, Doctor in Political Science (University of Liege and University of Paris VIII), is president of CADTM Belgium (Committee for the Abolition of Third World Debt, www.cadtm.org ). He is the author of A diagnosis of emerging global crisis and alternatives, VAK, Mumbai, India, 2009, 139p; The World Bank, A Critical Primer, Pluto Press, Between The Lines, David Philip, London-Toronto-Cape Town 2008; Bank of the South. An Alternative to the IMF-World Bank, VAK, Mumbai, India, 2007; Your Money or Your Life, The Tyranny of Global Finance, Haymarket, Chicago, 2005.

[3] For instance, the share of social economy within the private sector is very low: it reached 1.6% of gross domestic product at the end of 2008, up from 0.5% in 1998. Out of a total of 11,692,071 working people at the end of 2008, only 201,773 work in the social economy cooperatives, i.e. barely 1.7%.

[4] See Victor Álvarez “The transformation of the Venezuelan productive model : review of ten years of government”, Revista La Comuna n°0, p. 37 to 55. Victor Álvarez was Minister of Basic Industries in the Chávez government from January 2006 to August 2007.

[5] This statement has to be qualified: until 2002, although a public company, the operation of PDVSA (Petróleos de Venezuela Sociedad Anónima) had progressively favoured the private sector. A large part of its revenue was declared and taxed in the United States. The measures taken by the Chávez government from 2002 onwards enabled the State to take over the company’s management, which resulted in a strong increase in revenue to be later used to finance social policies.

[6] The Misión Mercal S.A. (MERCado de ALimentos) is one of the social programmes promoted by the Venezuelan government. Officially launched on 24 April, 2003, the Misión Mercal is designed to serve the food sector and comes under the control of the Ministry of Food. The programme involves building shops and supermarkets and supplying them with staples and basic products at low prices that are affordable by the needy.  Food products are subsidized and arrive on the shelves without middle-men, so that the prices offered usually represent a discount of 30% to 45%, compared to the prices charged in other distribution channels.   http://es.wikipedia.org/wiki/Misi%C3%B3n_Mercal

[7] Productora y Distribuidora Venezolana de Alimentos (Pdval) was created in January 2008 http://www.abn.info.ve/go_news5.php?articulo=117377

[8] Quoted by Victor Álvarez.

[9] See Mark Weisbrot and Luis Sandoval, The Venezuelan Economy in the Chávez Years, Center for Economic and Policy Research, Washington, 2007, www.cepr.net

[10] A personal anecdote: in late November-early December 2006 in Caracas, I was utterly astounded to see in the middle-class neighbourhoods that thousands of Christmas trees imported from Canada were being sold. In the shops, they were also selling quantities of devices to spray artificial snow on the trees. It should be added that in Caracas the temperature around Christmas is over 20°C. The massive import of Christmas trees from the Great North is very profitable thanks to the overvalued bolivar. It is true that Chávez criticized this pattern of systematic imports, all the more so as, he said, it was linked to cultural traditions (Santa Claus for instance) that were also imported and unquestioningly adopted to the detriment of local cultures.

[11] The foreign financial papers The Economist and the Financial Times regularly stress that Venezuelan private banks are very pleased with this opportunity given by the State to bypass capital movements control.

[12] See http://www.cadtm.org/IMG/article_PDF/article_a4492.pdf and Martha Harnecker “Selección de las opiniones más destacadas de los intelectuales reunidos en el CIM” (Selection of the most prominent opinions of the intellectuals in the CIM meeting) http://www.rebelion.org/noticia.php?id=88131 which takes up extracts from several speeches given during the meeting of intellectuals organized by the CIM in early June 2009.

Bolivarian Venezuela at the crossroads Debate and contradiction in the PSUV (United Socialist Party of Venezuela) (Part 2)

Eric Toussaint[1]

During the 2007 constitutional referendum, one might have thought that the party created by Hugo Chávez in 2006 was stillborn since fewer people voted 'Yes' than the number of people officially enrolled in the party.[2] But this impression was partially belied in the following months: grassroot meetings multiplied, which resulted in the nomination of candidates for the municipal elections and for governors of the 23 states that make up Venezuela. However, the process is contradictory. While participation from the party’s rank and file was active and effective and while grassroot members did appoint candidates for the elections, the fact stills remains that when it came to the party’s executive board, ordinary members could not vote for all the leaders and Chávez himself put his government’s ministers in the party's key posts (for example, the 8 vice-presidents of the PSUV). This creates a regrettable confusion between the State, the government, and the party.

In this respect some voices have been raised within the PSUV to challenge the fact that the party’s management and coordination are left to the ministers who are already overloaded with their governmental mission. Moreover their position as ministers gives these leaders the power to disproportionately influence the decisions taken by the party. It is also easier for them to influence some party members when the latter are called to the polls. A critical view, shared by a substantial number of activists, was expressed by Martha Harnecker as follows: “One of the things that surprise us and, I imagine, must shock people abroad, particularly in Europe, is that the State is the instrument with which the party is built. It is in clear contradiction with our vision of the party.[3]

Gonzalo Gómez, a PSUV activist and co-founder of Aporrea, also shows concern regarding the relationship to be built between the party and popular power (which he also calls “the constituent player”): “The party can seek to propose and give direction, accompanying social movements in the building up of popular power, but it cannot subjugate popular power: in other words subjugate this constituent player by the constituted power.”[4]




Communal councils: when “constituent power” challenges constituted power


The law entitled Ley de los consejos municipales (LCC)[5] was voted without any genuine debate on 7 April 2006. Its article 3 states: “The organization, functioning, and action of communal councils must meet the principles of co-responsibility, cooperation, solidarity,  transparency […], honesty, effectiveness, efficiency, social responsibility, social control, equity, justice, and gender and social equality.” (art. 3, LCC)

A citizens’ assembly (Asemblea de ciudadanos y ciudadanas), “the grand decision-making body of communal councils” (art. 6, LCC), must consist of at least 20% of inhabitants from the age of 15 and over (Consejos comunales, Expresión del poder popular). The communal council defines its jurisdiction, and its members are not paid (art. 12, LCC). Its various areas of intervention are defined as follows: “Health, education, land management in towns or rural areas, housing, social protection and social equality, popular economy, culture, security, communication and information, leisure and sports, food, technical guidance on water, technical guidance on energy and gas,  services, and any other matter the community may decide useful to proceed with.” (Art. 9, LCC)


President Hugo Chávez set up communal councils back in 2006, as a way of introducing participation in the drafting and implementing of local policies. The government sets great hope in these councils, which it sees as “territorial grassroots units of popular participation and self-government. As the president said, this “revolutionary explosion of popular power” must be the realistic and sustainable basis for a new type of state, for “a socialism of the 21st century.” (…)

Talking about the 15,000 councils already extant in June 2007, Juan Leonel M. (FONDEMI, Microfinance Development Fund) does not hide the fact that relationships with municipalities are sensitive: “Actually the mayors, or at least many of them, are opposed to this new mode of election and way of organizing communities. They see the communal councils as organizations in competition with their own administrations. But the idea today is that the established power must move hand in hand with the constituent power of communal councils. The State is initiating a revolution within the State system. The people’s constituent power must be the motor of change. Communal councils are the cornerstone of municipal self-government where the people have direct access to power.” [6]


The 2006 law on communal councils is currently being changed. It is likely to be replaced shortly by a new law that is being drafted[7]. To know more about this experiment, read Martha Harnecker’s books on the subject. She lives in Venezuela and has devoted much time in the last few years to the experiment with communal councils.[8]



The PSUV Congress was held in several sessions from November 2009 to April 2010. The 772 delegates who took part in the Congress were elected in a secret ballot by rank-and-file party members (according to official figures, half of the 7,253,691 party members turned out for these internal elections). There were very few workers and company trade unionists among these delegates; on the other hand many delegates were employees who are answerable to the party or to local authorities and are therefore easily influenced. Even though Hugo Chávez, as president of the party, called on delegates to act in Congress as spokepersons for the popular base and social movements, with Congress composed as it was, it is hard to see how this could really lead to positive results.


In June 2009, the PSUV was the center of attention and debates, when thirty of the most eminent intellectuals invited by the Miranda International Center[9] discussed the progress of, and remaining obstacles to, the revolutionary process currently taking place.

The CIM published a summary[10] of these days for reflection entitled “Intellectuals, democracy and socialism: dead ends and paths to follow”.

Here are some extracts from the summary which give an idea of what is at stake in the party itself and beyond, if a genuine revolutionary project is to be implemented.

“What is the future of a party whose base rarely gets the opportunity to have their say? (…) Is this non-separation between State and party merely repeating a mistake of the 20th century socialist model? Was the PSUV created as a top-down structure out of a political necessity felt by the government, rather than a necessity felt by the base?

Another important aspect that came up several times was the need for collective leadership of the party, which is effectively based on grassroots social movements (and which does not merely use them as the government’s communication channel during election periods), thereby putting an end to harmful, partisan vote-catching. This would create the base of a true revolutionary party which recognizes the right to express criticism and which fosters greater democracy within the party.”

Among other issues debated: the nature of the new revolutionary State (“If the State was the instrument used by neo-liberalism to implement its own agenda, should it also be used to free us from neo-liberalism? Can this State put us on the path to socialism or, on the contrary, it is an obstacle to socialism?); the role of the media, both pro- and anti-Chávez; the characteristics of the revolution – it was said that it contained “many types of revolutions within it: student, farmer, worker, socialist, feminist, military and popular”, thus the need for a constant dialogue between these groups; the definition of 21st century socialism; popular participation, especially through communal councils (see box above), which were described as “a prime example of participation” but “not [playing] a sufficiently participatory role” in practice because “they run the risk of being co-opted by the party”.


The final issue considered during the meeting concerned the place and role of criticism in a revolutionary process, and the main question discussed was the following: “Is it possible for a revolution to succeed if it does not make criticism one of its main driving forces?” It was acknowledged that “criticism has lost some of its rightful place. In media that are sympathetic to the process, it is not difficult to find reactions reminiscent of 20th century socialism where those who openly criticize are accused of being “counter-revolutionaries” or “CIA agents”. This considerably weakens the process as it prevents the government from implementing changes when things are not working.” At the same time, the intellectuals said they “were pleased that the Executive had given them a space for criticism - something which had not happened in ten years. They also stressed the fact that this event proved that fear of criticism was unfounded. The claim made by the anti-Chávez opposition that there is a lack of freedom of expression in Venezuela is equally false.”

The controversy raised by this meeting showed how relevant these questions are. These days were broadcast live in full on a public channel (TVES) and then re-broadcast over a period of some 10 days. Important sectors of the government strongly criticized the CIM initiative as well as the content of these meetings. Among the critics were the Minister for Oil, Rafael Ramirez, and the Minister of Foreign Affairs, Nicolas Maduro, both of them important political figures in the PSUV. One of the pro-Chávez daily newspapers, VEA, published several articles condemning the CIM initiative and stating that, “they convene meetings amongst intellectuals whose positions are confused, whilst allowing them to let off steam at Chávez’s leadership which they describe as a “hyper-leadership” or “progressive autocracy”. Without a doubt, these are pro-Chavist supporters without Chávez, ashamed to show their true colors and get on the other side of the fence.” (published 6 June 2009 under the collective signature Grano de maíz).

After ten days of controversy, both in the pro-Chávez and the opposition press, Hugo Chávez, in his televised programme Aló Presidente of June 14, seemed to agree with those who criticized the International Miranda Centre (CIM). That merely served to increase public interest in the event: different trade union worker leaders as well as the Communist Party of Venezuela and “Homeland for All” (two parties which support the government while refusing to join the PSUV) have defended the CIM and stated that the critical contribution of revolutionary intellectuals was a positive event. It was feared that at some point the CIM would be brought to heel or even shut down but nothing of the sort has happened. This shows once again the complexity of the changes taking place in Venezuela, whose government cannot be considered as totalitarian.


Translated by Francesca Denley, Judith Harris, Stéphanie Jacquemont and Christine Pagnoulle

Next part: The Venezuelan economy: in transition towards socialism? (Part 3)

PART 1 “Venezuela. Nationalization, workers’ control: achievements and limitations” is online: http://www.cadtm.org/Venezuela-Nationalization-workers



[1] Eric Toussaint, Doctor in Political Science (University of Liege and University of Paris VIII), is president of CADTM Belgium (Committee for the Abolition of Third World Debt, www.cadtm.org ). He is the author of A diagnosis of emerging global crisis and alternatives, VAK, Mumbai, India, 2009, 139p; Bank of the South. An Alternative to the IMF-World Bank, VAK, Mumbai, India, 2007; The World Bank, A Critical Primer, Pluto Press, Between The Lines, David Philip, London-Toronto-Cape Town 2008; Your Money or Your Life, The Tyranny of Global Finance, Haymarket, Chicago, 2005.

[2] Officially, six million Venezuelans joined the PSUV at the time of the referendum on 2 December 2007. And yet the ‘Yes’ won only a little more than four million votes, some of which certainly did not come from  PSUV activists since the PCV (Partido Comunista de Venezuela, Communist Party of Venezuela) and the  PPT (Patria Para Todos, Homeland For All), among others, called for a ‘Yes’ vote. In fact, during the phase when the party was launched, ministries were given membership targets, which resulted in a flawed process and an artificial inflation of membership figures.

[3] Speech of Martha Harnecker on the occasion of the meeting “Intellectuals, democracy and socialism: dead ends and paths to follow organized by the CIM http://www.rebelion.org/noticia.php?id=88031

[4] Speech of Gonzalo Gómez on the occasion of the meeting “Intellectuals, democracy and socialism: dead ends and paths to follow organized by the CIM http://www.aporrea.org/actualidad/n136570.html

[6] Quoted in « Les conseils communaux au Venezuela : un outil d’émancipation politique ? », by Anne-Florence Louzé, in Olivier Compagnon, Julien Rebotier and Sandrine Revet (eds), Le Venezuela au-delà du mythe. Chávez, la démocratie, le changement social, Editions de l’Atelier/Editions Ouvrières, Paris, 2009, 238 p.

[8] See Martha Harnecker “De los consejos comunales a las comunas” http://www.rebelion.org/docs/83276.pdf. This 61 page  study includes a bibliography of Martha Harnecker’s 21 books  on the subject of popular participation. Read also, by the same author, “Las Comunas, sus problemas y cómo enfrentarlos” http://www.rebelion.org/docs/90924.pdf

[9] The Miranda International Center (CIM) is an official institution created by the Venezuelan presidency and financed by the Ministry of Higher Education.

[10] The complete summary (in French and Spanish) is online on the CADTM website at http://www.cadtm.org/Venezuela-premiere-synthese-de-la and http://www.cadtm.org/Primera-sintesis-del-encuentro