Monday, July 05, 2010

Venezuela: Economic War In the Run-Up To The Parliamentary Elections

Written by Patrick Larsen and Alan Woods
Monday, 05 July 2010

If it is to succeed, the Venezuelan revolution must be taken to the very end, with the expropriation of the capitalists and landlords who still control two thirds of the economy. This is a powerful lever in their hands that they are using to organise economic sabotage to undermine the government. The right-wing, reformist fifth columnists within the Bolivarian movement are attempting to hold back the revolution. That is where the danger lies.

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sonia said...

This is absolutely amazing. They took a Stalin's speech from the late-1920's, changed the names, and inserted it in an article about Chavez.

"The Soviet Union finds itself in a highly volatile situation. The kulaks are on the offensive, using their economic power to sabotage and hoarding in order to provoke food shortages.

For its part, the Soviet government is trying to solve some of the problems, but the measures it has taken are timid and don't go to the heart of the problem. A big part of the problem facing the Soviet Revolution is widespread popular resentment against the party bureaucracy – those elements who have joined the Soviet Revolution, not to fight for socialism, but to make a career, obtain lucrative government contracts or jobs in the state or the Party. This stratum, that is becoming more and more powerful, represents a real danger to the Soviet Revolution. And its Trotskyists tentacles reach high up in the government and the Party."

Words like "sabotage", "hoarding" and "tentacles" were mentioned in practically every Stalin's speech from the era...

Venezuela is now in 1929. Former Chavez's supporters, now opposition leaders, leave the country, like Trotsky did in 1929.

And ahead? First a genocide of Venezuela's kulaks - what remains of small private enterprise owners. And later - huge purges inside Chavez's government - Caracas show trials.

History is repeating itself almost exactly. Both targets - the kulaks/small business owners and the bureaucracy - having been explicitly identified in both speeches.

Later still - Stalin's invasion of Finland and other countries/Chavez's invasion of Colombia. Stay tuned...

SecondComingOfBast said...


There is one big difference. If Chavez invades Columbia he'll probably get his crazy ass kicked.

sonia said...


one big difference. If Chavez invades Columbia he'll probably get his crazy ass kicked

Stalin got his crazy ass kicked in Finland too.

SecondComingOfBast said...

Well, Chavez would be well-advised to not bite off way more than he can chew. He might not want to take a chance on Aruba kicking his ass, Columbia would definitely be his worse mistake possible. They might dig his grave toss him in it alive and screaming while they're tossing the dirt on. I seriously doubt they would give a shit what anybody would think about it at this point.

roman said...

What a surprise that there was mafia style "corruption" in the state's PDVAL food distribution system?
The article describes it as a “company” for obvious reasons. Now that its function is found to be deficient, the state spins it as a capitalist vestige. They set it up but now try to disavow any responsibility in the resulting mess.
The fact that the state controlled media reported this should make us extremely weary of the validity of the facts. We all know that a state controlled press evolves to become a political hammer on the opposition.
History tells us to ask the question. Is this the start of political “show trials” with manufactured evidence? How can we, or for that matter, the Venezuelan people believe ANYTHING being reported by the state controlled media?
Is Chavez following the Stalin playbook?
It is so very predictable and shows an outrageous lack of originality.
This report endorses an accelerated new round of state expropriations of land (like Sonia said.. the “kulaks” have got to be shown who’s really in charge) even though the above corruption is totally unrelated. Also, this report recommends PSUV inner circle “purges” just like Stalin’s show trials to clean house of all those who may (or even may not) have doubts about the Chavez movement.
With the lack of a free press, the people of Venezuela don’t know who to believe and are loosing confidence in Chavez to improve their lives.
This Bolivarian experiment is already unraveling in only a few years and so far is only contained within one state.

Frank Partisan said...

I'll respond this evening. I wasn't home all day.

The comments don't relate to the article. I'm not sure if the position of the article is understood.

A war between Colombia and Venezuela, is as imaginary as US/Israel threats against Iran. It won't be happening. It's rhetoric from the extreme left and extreme right. I can go on and on with reasons its imaginary.

Go back to the basics. Venezuela is a democratic, capitalist country.

Why did the 2002 coup fail? Because when power, all elected offices were abolished, causing the coup supporters to split and switch sides. Their lack of democracy caused a split.

I wouldn't believe the material about the corrupt, counterrevolutionary people around Chavez, except I met them. Some work in the Venezuelan embassy here.

sonia said...


Why did the 2002 coup fail? Because when power, all elected offices were abolished, causing the coup supporters to split and switch sides. Their lack of democracy caused a split.

I don't understand anything you wrote in that paragraph.

The 2002 coup against Chavez failed for the same reason the 1944 coup against Hitler also failed - both Hitler and Chavez were popular among the military, and for exactly the same reasons.

A war between Colombia and Venezuela, is as imaginary as US/Israel threats against Iran

I hope you're right. But if you're wrong, I will remind you of that quote.

Venezuela is a democratic, capitalist country

A country where opposition politicians and journalists have to flee abroad to escape imprisonment is not democratic in my book.

And a country where the government can take over your private property without compensation is not capitalist by any stretch of imagination.

A crocodile that devours a vegetarian is not a vegetarian crocodile...

I wouldn't believe the material about the corrupt, counterrevolutionary people around Chavez

They are certainly very corrupt (all those confiscated capitalist goods and enterprises would tempt the most uncorruptible Communist), but they certainly don't deserve as noble a name as "counterrevolutionary". Unfortunately, there are no heroes like Charlotte Corday or Fanny Kaplan in Venezuela.

Frank Partisan said...

Sonia: I think jumping to the most extreme conclusion, Stalin or Hitler comparisons, is a tool when an argument is lost. It's a bad habit.

The opposition split in 2002, when it became clear they didn't want democratic institutions. The opposition splitting saved Chavez, as did people standing up for their elected leader.

I will give reasons for war being an illusion, in response to Pagan.

Roman: You are way off about the press in Venezuela. Ever watch Univision? The media is mostly private.

I met some of the hacks in the Venezuelan government. They do sabotage reform. They'd fit in better, in the Democratic Party. They fight tooth and nail against democracy in the PSUV. They are careerist.

Pagan: The right won the recent elections in Colombia. They got a large percentage of a small turnout. There are no Bolivarian candidates allowed.

The bigger point is, Colombia is well armed militarily, but not strong with the masses. A war could set off a revolution.

Atleast now the activists who lead in Colombia, are urban trade unionists, not FARC. War could unleash an urban revolt, with FARC as the rearguard. Venezuela and Colombia are tied together economically. A war would devastate the socialist experiment.

SecondComingOfBast said...


Chavez has compensated owners when he has expropriated their holdings. He has paid supposedly what the enterprises are worth at the time. Unless things have changed, that's his policy, but that's neither here nor there. The owners have no say in the matter, so its still not capitalist. Ren doesn't get the point. What is Chavez going to do when there are no more businesses to expropriate? If you build it they will come, but if you tear it down, why should they? I wouldn't so much as open a taco stand in that worthless country. No one wants to invest in a country when they know their chances of growth and expansion are slim to zero, and if they do happen to do well, their holdings can be taken at the drop of a hat for "fair market value".

No one opens a business with the intention of being forced to sell it at whatever the current value is, or as it is determined to be by the government. If people decide to sell their holdings, or if they wish to purchase a business, they try to factor in future growth potential and that becomes a part of the negotiations.

The only time that becomes a part of the Chavez process is when he realizes he might have a gold mine on his hands, and he decides he wants it. The owner gets no say as far as value goes.

In the case of Exxon, and other international companies, when he expropriates their holdings in Venezuela, it just discourages other international companies from investing there. Why should they? If I'm a stockholder in a company and I hear they are planning to put resources there, I'm going to raise holy hell. At one time it might have been considered a risk worth taking, now it would cause a shareholder's revolt.

Frank Partisan said...

Pagan: The Venezuelan government has a multimillion $$ deal with Haliburton.

Chavez gets investments from whoever is the newest flavor, against the US bloc.

SecondComingOfBast said...

That's an interesting bit of news about Haliburton. I'd like to learn more about that.

As for his investors, I'm assuming you mean Russia, Iran, Brazil, and maybe China, maybe even India. Funny thing is, I seem to remember a time when Chavez went around passing out money like it was candy. He used to be the big pimp daddy, now he's more like the town whore.

How long is it going to be before he goes to the UN with his hat in his hand requesting aid? After all, he is a one man disaster.

sonia said...


Chavez has compensated owners when he has expropriated their holdings.

So that's why Ren says that Venezuela is still capitalist. Even in US, expropriation with compensation is quite routine. It's called "eminent domain"...

Funny how I never heard about those compensations. Anti-Chavez articles don't mention them because they don't fit their "Chavez is a bloodthirsty ogre" narrative. And Marxist pro-Chavez articles don't mention them because they don't fit their "Chavez is a true Communist revolutionary hero" narrative.

But in reality Chavez is just a wimp too afraid to expropriate without compensation (like a true Communist revolutionary is supposed to), because he is too scared nobody would invest.

And I am curious how many Venezuelan companies were expropriated with compensation where the only thing of real value was the expertise of the owner... Chavez paid for a building and a few old computers. And the owner is re-creating his company in Miami...

SecondComingOfBast said...


Well, I think he did it mainly to avoid potential lawsuits in international courts, but I'm not sure about that. All I really know is that he paid what the companies were supposedly worth at the time he expropriated them, but it was unclear to me how that determination was based, or on what it was based, other than fair market value.

Two examples that stick in my mind are-the Venezuelan holdings of an American oil company (I think Exxon) and those of a Spanish cement company, the name of which I don't remember now.

Of course, nobody is going to start a business with the goal of one day having it expropriated by some government for fair market value. That's the kind of deal you try to get when you realize you're headed for bankruptcy if you don't sell. Otherwise, if you try to sell your business you typically try to sell it based on future growth and profit potential, which in most cases would make a healthy, prosperous company worth substantially more than its mere current fair market value.

Of course, by the time Chavez is through with them, any business he takes will probably be worth less than what he paid for it, probably far less, so its a lose-lose all the way around.

Frank Partisan said...

Sonia: I agree with you about the expropriations to a degree. I read the financial press, to get the story on expropriations.

Pagan: I finished reading an extremely anti-Mao book, written by an ex-Red Guard. She even blames Mao for the Russian invasion of Hungary. The 1949 Chinese Revolution wasn't socialist. Mao used the Red Army to squash workers occupation. Expropriations came much later. She said owners were compensated. Mao compensated and Castro offered compensation.

SecondComingOfBast said...

What was the political leanings of this woman? Was she a capitalist or socialist? Did she have anything to say about Mao's program of encouraging peasant Chinese to smelt their own iron? I read that all kinds of peasants used to operate their own little mini iron making operations outside their own homes, but most of the iron wasn't worth much, mostly recycled crap that was useless for export purposes, which means it must have been pretty substandard all the way around.

Frank Partisan said...

Pagan: She went into horrific detail about the ridiculous "Great Leap Forward," and the iron melting.

I read both of Jung Chang's books on China. I don't know where to put her politically. I like her books. She is often on Fox News. I believe she would have liked Trotsky, if she was exposed to him. Her parents were actual communists, who were brutally harassed by The Red Guards.

Anonymous said...

Jung Chang is a dishonest hack. Anyone familiar with the available known record of demographic constructions on China will realize how she deliberately took numbers from sharply conflicting sources and cut-and-pasted them together to mislead the reader. A more useful book would Banister's somewhat dry text which at least gives a more comprehensive set of data:

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