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economic justice | government

Memories of “Popular Power” in Venezuela’s economy

* From false co-management and cooperatives to the deceitful EPS, we present a balance of what has happened in Venezuela after at least 7 years of pretending to build a socialist economy, where the available data and verifiable facts belie the failure of the Chavez administration.
Since 2001 we have heard the government's promises to foster a production model where the Venezuelan state would create the conditions to enable and support the growth of a new endogenous economy - at first denominated popular or in solidarity, later socialist - started 4 years ago amid a plethora of promises to entice voters in the referendum of August 2004, and repeated in later electoral contests. As per the offer, the main actors and managers would be the workers involved via socialist co-management of already existing enterprises or newly constituted cooperatives. This discourse became more intense and radical as the years went by, when everybody, from Chavez on down to the last official voice would not cease to repeat that the irreversible construction of a revolutionary and participatory production structure had started, in which were invested all efforts and resources possible, as emphatically proclaimed every Sunday during the presidential TV show, from where the slogan "factory closed, factory taken" (by their workers) was announced and where we were told that we had become the country with the most cooperatives in the whole world.

º Questioning the farce

Very soon, we anarchists started to warn (see nos. 38, 42 and 43 of El Libertario) about what was hiding behind the proclaimed intention to "build Bolivarian socialism" as the official slogan proclaimed. This is in essence what we have said about it:

- The state-promoted cooperatives were a way to minimize the statistics of unemployment and of employment in the informal economy, an easy way to generate temporary employment, underpaid and without benefits, where the precarious working conditions prevalent in the majority of the flaming socialist cooperatives soon became evident, where one or a few - connected to the spheres of official power upon which depend the survival of these initiatives - end up being the bosses of the rest of the "associates". As far as concrete results from this boom of Bolivarian cooperatives, see next.

Numbers from the "cemetery of cooperatives"

// According to SUNACOOP (National Supervisory of Cooperatives) and other official pronouncements there are 200,000 registered cooperatives, although in 2007 there was talk of 250,000; nevertheless, in attempting to formally quantify real cooperative activity - a survey by SUNACOOP in 2006 - the number was barely 47,000 cooperatives.

// According to official propaganda, the missions Vuelvan Caras I and II between 2004 and 2006 received 954 million Bolivars that allowed 627,554 lancers (mission participants) to organize 6,814 cooperatives, in turn grouped in 130 Nuclei of Endogenous Development.

// Qualified experts on cooperatives in this country question the validity and the simplistic bent of the official data: Oscar Bastidas has said that what really exists is a "cemetery of cooperatives"; while Alberto Dorrenochea says that in the most optimist scenario there would be some 15,000 active cooperatives.

// Out of the 47,000 associations surveyed in 2006, 67% (31,486) were not active. Considering the total surveyed, 74.5% are registered as commerce and services. Hardly 14% (6,580) have received financial support from public or private banks, of which a little more than half have accounted for the resources received.

// The 2006 survey includes 4,836 cooperatives registered by participants in the Vuelvan Caras missions, which is 29% less than the number published by the official propaganda. Out of that number surveyed, only 49% (2,370) were active, of which 76% are in commerce and communal services, while only 24% (569) were involved in production.

- Since the beginning, co-management has been a ruse so that a handful of private enterprises in bankruptcy or serious difficulties (about half a dozen in the country) could become government property by way of "expropriations" that in every case were juicy business for the former owners (and their associates in the government) and with no protest from those affected by this presumably anti-capitalist action being heard. There was also a state enterprise (Alcasa) around which the myth of the achievement of a socialist co-managed administration was created, which has been questioned with powerful arguments (see El Libertario #51 and press releases about Alcasa early in 2008)

- Unfortunately, cooperatives and co-managed enterprises for the most part owe their existence less to struggle and/or grass-roots consciousness raising and more to a need for imagery to seduce the popular sectors - attracted by the offer of money, employment and government backing - as well as the militants convinced that they are part of a deepening revolutionary process; and that's the reason why they are also useful to domesticate and contain possible insurgency from sectors susceptible to radicalization or to asking uncomfortable questions, as well as for the creation of new political clients.

- In practice, the Venezuelan state wants to maintain absolute control over these initiatives. To their chagrin (and more and more, over their sore backs) many workers have seen that socialist verbosity on Sunday TV is one thing and concrete action by the state is another, that the state only loosens the purse strings and gives support when it has the obedience of the "Sovereign" as the Chavez machine likes to call its docile followers, without forgetting the insulting cynicism of this authoritarian intervention being made via ministries self-proclaimed as from the "Popular Power" since January 2007.

º More fairy tales

The failure of cooperatives and co-management of the kind promoted by the government is evident between the end of 2007 and beginning 2008, in consequence the official discourse has had to mutate and now we have the joke of Socialist or Social (both are used) Production Enterprises (EPS in the Spanish acronym) proclaiming that now, yes, we have the formula to arrive at the promised land of Socialist Endogenous Development. The truth is that explaining what EPS's are is a useless exercise since under this acronym they include what's left of cooperatives and co-managed enterprises plus state-owned companies and private capitalist firms that for one reason or another align themselves with the state.

Recent official proclamations (see El Universal 03/11/08) say that by 2009 there will be 73 new EPS's, the result of the "Socialist Factories" plan, under indirect social management - a euphemism that translates as state-owned capitalist enterprises - that would be the base for future endogenous industrialization. Such announcement can only be taken as a joke, considering what happened to Alcasa, Invepal, Invetex, Inveval, Sideroca/Venetub, Sanitarios Maracay, Central Azucarero Cumanacoa, Central Azucarero Motatan, Merida's Solid Waste Treatment plant, Sabaneta's Centinela tomato farm, to mention only the most recent cases which can be corroborated in the press and the Internet, where it has been mainly the workers who pay for the damages caused by corruption, authoritarianism and incompetence which are the product of the vile actions of this "Popular Power" when it intervenes in industrial activity.

Armando Vergueiro [Translation: Luis Prat]

(El Libertario #53, p.5, May- June 2008, Venezuela)

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