Leander Perez is a member of the central committee of Lucha de Clases, the Venezuelan chapter of the International Marxist Tendency. He committed to the struggle of the poor at an early age while reading Fyodor Dostoyevski, but what sparked his active political engagement was the violence exercised against Chavistas when Hugo Chavez died in 2013. One year later, in 2014, Perez joined Lucha de Clases.
In this interview, we look at the economic and labor policies of the Venezuelan government while examining the role of the working class in the future of the Bolivarian Revolution.
Let’s start with the Venezuelan government’s labor policies in the last year or so. How do you analyze these measures, particularly since the government implemented the Economic Recovery Plan in August 2018?
The first thing that I should mention is that the Economic Recovery Plan does not mark the beginning of the government’s economic shift. It is, nevertheless, a synthesis and a more elaborate plan, bringing together policies that were already being applied either legally or in a de facto manner. This includes lifting price controls, eliminating some import subsidies, flexibilizing employment, replacing income with direct, ad hoc subsidies, and other economic policies.
Let’s, however, focus on the Economic Recovery Plan. One of the first items was monetary reconversion: five zeros were taken from the currency, while the minimum monthly salary of 50 Sovereign Bolivars was raised to 1,800, or around 30 USD. Bear in mind that the minimum wage with Chavez had been around 300 USD. Still, before the reconversion, the salary stood at about USD $2 per month, so the increase was well received. Nonetheless, the Plan included other measures such as the curtailing of workers’ rights and the easing of worker layoffs.
Additionally, the wage hike mentioned earlier was implemented along with a subsidy to employers: the government would pay for three months’ salaries. This policy, which was later extended beyond the three-month period, was intended to prevent employers from raising prices.
As if that weren’t enough, Venezuela’s executive branch, through the Labor Ministry, issued memorandum No. 2792 with precise instructions to protect the interests of capitalists. It was based on a very crude interpretation of Article 148 of the Labor Law – which actually seeks to limit layoffs while establishing mechanisms in this matter. The memorandum establishes that when a company faces a financial crisis, a special bilateral commission with the participation of Ministry of Labor representatives and employers would be formed to assess layoffs and authorize employer non-compliance with collectively-bargained agreements.
What can you tell us about the specifics, about how that memorandum affects workers?
Let’s talk about one particular case: the collective bargaining process between the Unified Union of Graphic Arts Workers [SUTAGSC] and the Association of Graphic Arts Industrialists of Venezuela [AIAG]. In the process, the workers had achieved small collective victories. However, when the two sides presented the agreement to the Labor Inspection Office [Inspectoría del Trabajo, a public office associated with the Labor Ministry], the institutional representatives kept the contract from being signed, because it was considered “burdensome for the employer.” Obviously, after this happened, the capitalists were emboldened and demanded concessions from the workers.
It’s worth mentioning that around the same time, the Planning Ministry issued a circular informing that all public administration salaries would be unified. This meant that collective contracts were eliminated by decree from one day to the next. Decades of struggle to achieve collective benefits were eliminated, and the salaries were unified downward, ignoring things such as qualification and worker experience.
All these policies were applied in the context of a veiled policy of wage containment and an income-bonification process [replacing income with direct subsidies]. To date, the government continues to regularly decree salary increases, but the fact is that the purchasing power (especially of public employees) has been dramatically reduced.
To give you an idea, the 1,800 Bs.S. monthly income increase in August 2018 was equivalent to 30 USD, while January 2020’s 450,000 Bs.S. monthly income amounts to a monthly wage of about 7.2 USD. Together with this – implicitly recognizing that it is impossible to live on a minimum wage – the president issues bonuses (which are often higher than the minimum wage) through the Homeland Card.
Those living on a minimum salary (mostly public administration employees and retired people), do not make enough to cover their most basic needs. To alleviate the situation, the government offers food bags (in addition to the residential CLAP box) to public employees.
In fact, this is the real reason that keeps public employees at work. If we apply the legal precept that “reality must prevail over forms,” then we should acknowledge that today public employees are paid with food. The situation of retired people is even worse, since they receive neither food bags nor food bonuses.
To understand the situation we are facing in Venezuela, it is important to take a look at Venezuela’s productive apparatus. It’s well known that over the course of the oil boom during Hugo Chavez’s presidency, the local productive apparatus shrunk due to policies that favored imports. However, the most dramatic fall in productivity has happened in the past five years: according to public information, the drop is between 30 and 50 percent. In response to this situation, the government has made a plan to attract “foreign investment” that includes offering tax exemptions and an covert process of privatization of public assets. What do you make of all this?
The data that you point to regarding the shrinking of the productive apparatus – data recognized by Venezuela’s Central Bank – demonstrates the parasitic dependence of the Venezuelan bourgeoisie on public subsidies. During the economic boom, private companies in Venezuela were actually “public” companies in private hands. Why? Because they were directly financed by the state’s oil rent.
Let’s turn now to the government’s incentives for capitalists and its thrust towards privatizations. The government, in my opinion, adopted the line of Deng Xiaoping’s reforms [in China]. What does this mean? The government is offering a cheap labor force and flexibilized labor regulations, low taxes, while opening up to “Special Economic Zones” [territories where certain laws don’t apply]. Additionally, “strategic alliances” [covert privatizations of public companies] and full protection of bourgeois private property are key to the government’s discourse. In fact, Venezuela hasn’t seen any expropriations since Chavez’s death.
Additionally, the National Constituent Assembly passed a Law for the Promotion and Protection of Foreign Investment which flexibilizes the shareholding of public-private companies and exempts investors in strategic areas (such as the oil industry) from paying taxes. This law was passed during the 2018 Christmas recess.
In Nicolas Maduro’s 2020 address to the nation, he asked for the approval of a new package of laws dealing with fiscal matters. He did not give details, but considering the current state of affairs, the package is likely to offer further “incentives” to the private sector.
There is no doubt that Maduro is trying to prove that he is “the man” capable of steering Venezuela towards a capitalist-model-with-Chinese-characteristics. It is important to note, however, that the adjustments package and the incentives to foreign investors have not produced the desired results. The reasons for this are multiple: first, there is a crisis of world capitalism and many businesses are closing down worldwide. Second, the few capitalists who could invest here still fear the Bolivarian Revolution and its popular manifestations. Finally, and perhaps this is the most important issue, capital’s only longstanding objective in Venezuela has been and is to capture the nation’s oil rent. In other words, international capital will do nothing more than focus on the oil industry and the mining initiatives underway.
Recently there have been mobilizations of some sectors of the working class such as teachers, nurses, subway workers, and also some wider protests. However, the relatively low level of street mobilization is surprising, given that the minimum monthly salary oscillates between USD $5 and $10 and given that the working class’s collective rights are being drastically rolled back. What’s going on?
What you say is true. The number of mobilizations does not correspond with the [austerity] package imposed on the working class. It is even more surprising if we take into account the insurrections underway in Haiti, Ecuador, Chile or Colombia.
Since the ‘60s, the oil rent allowed for the construction of what Juan Carlos Rey called a “populist system of reconciling elites,” a “complex system of negotiation and accommodation of heterogeneous interests in which utilitarian mechanisms play a central role in generating support for a regime.” Or, in Gramsci’s words, the state builds hegemony through consensus building with, we add, the oil rent revenues.
To give you an example, the oil rent allowed the key trade union movement, the Central de Trabajadores de Venezuela [CTV, Venezuela’s Workers Central], to establish corporate mechanisms for worker representation while surrendering class independence. During Chavez’s government, this model was criticized and there was an attempt to promote an independent and class-based trade union movement. Out of that came the Central Bolivariana Socialista de Trabajadores [CBST, Bolivarian Socialist Workers Central]. The CBST was born out of some honest debates, but it finally degenerated into a government appendage.
We can also point to the lack of class leadership in the labor movement as a factor that limits workers’ organization today. Recent attempts towards building organizations with class independence have gone through divisions due to opportunistic unions that ended up supporting the right. This is the case of the Intersectorial de Trabajadores de Venezuela [ITV, Venezuela’s Workers’ Cross‐Sectorial], which quickly became a referent but was liquidated by those who used it to support Juan Guaido’s coup attempts.
Additionally, there are initiatives such as the Frente Nacional de Lucha de la Clase Trabajadora [FNLCT, National Front for Working-Class Struggle], promoted by Venezuela’s Communist Party, whose strategy is to press for negotiation spaces with Labor Ministry authorities. Yet in these spaces, little or nothing is resolved.
However, since the working class faces the consequences of the economic crisis, what often happens is that workers, unable to find a collective solution to their problems, seek individual solutions such as better paid jobs in precarious conditions or emigration.
As if all this weren’t enough, we must acknowledge that the government has been extremely skilled, applying a combined strategy of carrots and sticks to neutralize possible enemies. The government tries to relieve the pressure through clientelist policies such as bonuses and food bags, but it also openly represses the rebellious expressions of those who have managed to overcome all obstacles. One case of repression is that of the Lacteos Los Andes workers who denounced corruption and the attempt to privatize the company, or more recently the teachers’ protests, both harassed by shock groups that have nothing to do with the spirit of genuinely Chavista organizations. The message is clear: “You either adapt or you leave.” In this context, both overt or covert repression of protests is the order of the day.
To come back full circle, in the context of the multi-crisis and the imperialist siege what is the importance, its apparent passivity notwithstanding, of the working-class struggle?
I think that the government’s policy is extremely dangerous. It’s weakening its popular support. As it is, the current base for the [government’s] defense are the bourgeois institutions and their civil or military bureaucracy, particularly the latter, which receives large concessions from the government.
Chavez was adamant: the socialist project has to be based on the support of workers, community organizers, campesinos and exploited people in general. By contrast, this government interprets the role of workers from a bourgeois perspective by demanding sacrifices: the working class must increase production at all costs to save the only nation known to capitalists: profit.
The working-class struggle is the only path that can offer solutions and recover the socialist project – and socialism is the only solution that can really improve the lives of the majority.
The government’s policies to come out of the capitalist crisis only weaken the working class. With this in mind, it’s very important that all left organizations support the struggles that occur as a response to the joint aggression coming from the lines of the bourgeoisie and the government. It is true that some of the working class struggles now have a defensive nature. Some mobilize against the high cost of living, others demand salary increases, others defend collective rights, but as it happened in Ecuador, Chile or Colombia, defensive struggles can (and should) escalate into revolutionary forms!
The struggle is going to be a long one. For this reason, we must draw the greatest number of lessons from each defeat, while each battle won must be projected to inspire the class as a whole.
Let’s take the struggle of the Graficas Ultra workers as an example: the employees sat down with the employers to negotiate a collective contract. The latter, taking advantage of a government provision that favors them, refused to make even the smallest concessions, and it even proposed layoffs as a “solution.” The employers also had in their favor the fact that a number of employees had accepted their “happy little box” [severance package] and left the company, affecting the workers’ mobilization capacity. When faced with the union’s refusal to accept cuts, the capitalists closed the negotiations and prevented the union delegates from entering the company premises.
The rest of the workers, in an impressive display of unity and class consciousness, defended the union delegates and refused to work. Following this action, the owners closed the gates of the business to pressure the workers. This provoked the workers to further mobilize and, following the example of Smurfit Kappa [factory currently under workers’ control], began demanding the occupation of the company under workers’ control. Finally, when faced with the risk of the workers taking over, the employers yielded and agreed to reopen negotiations.
This could be seen as a small victory, but if we assess the asymmetry of the forces, the morale boost, the increased consciousness that came out of the struggle, and the example given to other struggling workers, then the victory is huge! These workers pointed the way forward with revolutionary methods, so that the burden of the crisis is lifted from the shoulders of their class.