In 2012 Venezuela’s progressive Labor Law was about to be passed in the National Assembly. Since the law was set to amplify workers’ rights in a number of areas, this put the country’s capitalist class on alert. Factory owners began to sabotage production and shut down plants. This process, which put workers and owners in open conflict, affected the whole country, but was especially fierce in the industries of Guayana in Bolívar state.
After many long battles, workers in some factories got control of the plants as mandated by the Labor Law’s article 149. Here we hear the stories of the Equipetrol and Calderys factories in Puerto Ordaz (Bolívar State). The people who kept the factories running tell us about their struggle for worker control and about the hurdles that they had to overcome to keep the plants operative during the blockade, while explaining the need for import substitution.
Since 1964 Calderys has been making refractory material: bricks and a variety of panels that can sustain extremely high temperatures and pressure for blast furnaces and other heavy industries. It was long owned by a French transnational corporation. However, following an sabotage that the owners carried out in the wake of the Labor Law, Calderys’ workers took control of operations in 2016. Today, the Calderys plant is democratically-run by thirty highly experienced and committed workers.
THE HISTORY OF A TAKEOVER
José Guerra: Chávez’s Labor Law sparked a sabotage of production on the part of the owners. It was a coordinated effort by the capitalist class to bring the government to its knees and roll back the law.
The new Labor Law was promoted in May 2012, and by October, Calderys owners had stopped paying wages, alleging a negative balance in the company’s bank account. We began to track the enterprise’s revenues, and we quickly discovered some rather shady dealings. The company was purchasing [state oil company] PDVSA bonds with its profits. They then exchanged the bonds for US dollars which they deposited abroad. It was a capital flight scheme.
We introduced a claim before a court and eventually the bosses paid what they owed us. They did it by selling one single truckload of Calderys’ products. It then became even more clear to us that the company had no real solvency issues: we were producing thirty truckloads each month, and with just one cargo the bosses were able to pay all debts and back salaries!
Later, in 2013, we got word that Calderys France, the parent company, was closing up operations in Venezuela and would be firing all of us. By then we had a pretty good understanding of their operational and financial schemes. So, in a workers’ assembly, we decided that we were not going to let it pass. This was not bankruptcy, it was plain sabotage! And there were clear political objectives behind the operation.
Abimael Velásquez: When Calderys France ordered us to shut down the plant, we first explored the nationalization option. Calderys’ production is strategic for the basic industries in Guayana, so there should be an interest in keeping the factory running. Much to our surprise, the CVG’s [state-owned Corporation of Guayana] president said nationalization wasn’t a viable option. At the time, we suspected that there could be an under-the-table negotiation with the bosses, who wanted to close shop while maintaining ownership of the factory.
As all this was happening, we decided to be vigilant: we set a 24-hour guard and took turns to protect the plant. Our main concern was that the bosses would dismantle the factory, as they had already done elsewhere.
José Guerra: By 2014, the workers at the nearby Equipetrol plant had already taken steps toward worker control. They did it with support from Jesús Martínez, who was then Labor Minister, and by appealing to article 149 of the new Labor Law, which entitles workers to take control of a factory when the bosses jump ship.
We finally managed to take control of the enterprise here. The first thing we did was to carry out a thorough assessment of the plant with a view to reactivating production. The situation wasn’t easy, because the bosses had indeed succeeded at removing the cables that fed power to the machinery. However, there were workers here who had twenty and thirty years of experience, so we were able to solve many problems.
Plus working-class solidarity kicked in. We got the tools and cable we needed to reactivate the factory from Carbonorca [state-owned anodes plan], Indorca [worker-run metalworks factory], and other enterprises. That is how we reactivated the plant. 2015 through 2018 were very good years for Calderys: we were running the factory democratically, and we were getting contracts from the basic industries.
This doesn’t mean that it was easy. We ran into many hurdles due to our condition as a worker-run enterprise. Particularly administrative obstacles that came from the CVG bureaucracy, our natural client. Nonetheless, allies in the government helped us in overcoming these problems. However, around 2018 things began to get harder: the crisis, the sanctions, fiefdoms inside the CVG, and, later, the pandemic, all colluded to bring us to a halt.
WORKERS’ DEMOCRACY AND POLITICAL EDUCATION
Abimael Velásquez: In a worker-run factory, democracy becomes one of the pillars of the enterprise, but the democratic spirit doesn’t appear automatically in a factory that has been run by a transnational corporation for ages. That is why the Jesús Rivero Bolivarian Workers University [UBTJR, for its initials in Spanish] became so important to our project.
Around 2015 the UBTJR led workshops in political and technical education in various worker-run and publicly owned enterprises. They did so here too. We also had regular spaces to reflect on the social process of work, and to talk about socialism, worker control, and democratic management.
José Guerra: Worker-run factories such as Calderys are run in a democratic manner. There is a three-person administrative junta, but all important decisions are taken in a workers’ assembly where all votes count equally.
Here, at Calderys, we all work in the plant, we all cook and eat lunch together, and the books are open for review. In other words, there are no secrets!
This is light years away from the former owners’ control mechanisms. The capitalist bosses maintained corporate secrecy, and they developed questionable production practices to cut corners. They ran such an opaque operation that the company – while producing on a large scale – could allege bankruptcy!
This has much to do with Calderys being a dependent industry. Calderys’ parent company was in France and the local bosses had no commitment to Venezuela or to the workers. The revenues were turned into US dollars through various capital flight schemes.
José Guerra: Calderys is in a process of reactivation. Recently Sidor [state-owned steel plant] gave us a contract and the plant is now running, but another hurdle has come up. As a worker-run factory, the Labor Ministry has to annually renew Article 149 – which grants us control of the plant. Unfortunately, the ministry hasn’t renewed it yet. The nearby factories Indorca and Equipetrol are in the same boat.
This limbo situation creates immediate problems for us. First, there are companies such as PDVSA that need to see that our enterprise is in good legal and administrative standing before signing a contract. In fact, we have lost several major jobs because the ministry has not renewed article 149 for us.
Then, there is the uncertainty and precarity that the non-renovation of Article 149 brings to us. We ask ourselves: Is this just an administrative delay? If so, why the radio silence? Does some power group want to take control of the plant and hand it over to the former bosses or to other capitalist interests?
Unfortunately, these fears are not just paranoid speculation. Our brothers and sisters at C.E. Minerales [a factory producing alumina] are in the midst of a struggle to regain control of the factory: a few months ago an external junta was set in place by the Labor Ministry. Now the plant is being run as any old capitalist enterprise!
THE BLOCKADE AND REACTIVATION OF PRODUCTION
Abimael Velásquez: Calderys was fully active until 2018. Around that time production came close to a halt: we had very few orders. Then came the pandemic, which was the final straw. Now, however, some orders are beginning to come in. Our hope is that, as the basic industries begin to reactivate, they will turn to us for contracts.
José Guerra: Here, in Calderys, we have one advantage when it comes to the blockade: we have a reserve of raw material. We also have our production lines operational at 70% of installed capacities. That means that we could be producing 20 thousand tons of refractory material per year if the orders came in.
To overcome the effects of the blockade, we must jumpstart national production in this country, from primary to tertiary sectors. We carried out a study about the production costs of refractory materials, and it turns out that basing production in Venezuela [because of nearby raw material and cheap electricity] actually lowers prices. We suspect that this is true in all metalurgic production branches.
Of course, import substitution requires a coordinated plan. Venezuela consumes approximately 24 thousand tons of steel per year. With the exception of very specialized kinds of steel, the CVG can produce what the nation requires and more.
There is no hiding that, in the basic industries, the crisis took multiple plants and production lines out of operation. Our proposal is that, as the CVG reactivates, they develop a coordinated plan to incorporate Venezuelan industries – and particularly worker-controlled factories – into the recovery process. We can provide materials that meet international standards. In the midst of a blockade, sovereign production has to become a reality!
Aldemaro Mundaraín: Turning inward, toward Venezuela, is a must now. Unfortunately, old practices still prevail the at CVG and PDVSA: these enterprises tend to contract intermediaries who will either subcontract or, more likely, import the materials.
Calderys has the potential to provide refractory materials for up to 40% of what the nation requires. However, we could actually increase our share of the market: we now have the installed capacity to produce 20 thousand tons of refractory materials per year, but that could go up to 36 thousand if we are able to activate a production line that has been defunct since the former bosses lifted the power cables.
José Guerra: As we begin to get contracts, we will invest the profits in making Calderys 100% operative. Full operation is our objective. We will do so on the basis of our accumulated experience and knowledge as workers, and the history of struggle that gave us the tools to successfully run a large operation.
Founded in 1984, Equipetrol is a metalworks industry specializing in producing valves, manifolds, wellheads, and other equipment needed in the oil and gas industry. Equipetrol has been hard hit by the blockade and crisis. However, the group of workers who run it has a tremendous commitment to worker control and to socialism.
HISTORY OF A STRUGGLE
Leonel Véliz: Around 2011, the bosses began to fire workers: it was a reign of terror. In a short period of time, we went from having 260 to 40 workers in the plant. The plant’s manager was a psychopath. On top of the layoffs, he wasn’t paying our salaries.
A struggle began and eventually, in December 2012, the Ministry of Labor recognized our right to run the plant as established in article 149 of the Labor Law.
We were the first in the country to get control of an enterprise by activating the new Labor Law, so the process wasn’t easy at all: we had to deal with many uncertainties. First, we introduced a legal claim against the owner so that Equipetrol would pay what was still owed to the workers. While that was going on, we had to protect the plant to avoid looting by the boss’s hired men.
Once we got the keys to the plant, the problems continued because the former owner was still part of the transitional junta, and we needed his signature for financial operations. This meant that to proceed with any banking transaction, we had to rely on the representative of the boss, who did everything possible to sabotage administrative processes.
One day, after many hours trying to get this guy to sign some payments, the owner’s lawyer came to Equipetrol with fifteen National Guards alleging that we “kidnapped” the representative. However, when they arrived, it was obvious that we had not kidnapped the representative. They said to him: “Nobody is hurt here, sign the checks and let’s get this done with.”
Finally, we were able to get the Labor Ministry to remove the former owner’s man from the junta. That is when we really got full control of Equipetrol.
A SOCIALIST ENTERPRISE
Elis Pomontti: Equipetrol is a socialist enterprise. We talk through all our decisions and keep open books when it comes to accounting. Moreover, we all get paid the same. Here we look at material goods in a different way: the old saying “what is mine is mine” doesn’t apply in our company.
We often remember Comandante Chávez saying, ”We should not be selfish, we should be solidarious, we should share what we have.” That is a revolutionary precept and an old Christian teaching – it’s important for us.
Elvis Muñoz: We are solidarious with Indorca and Calderys whenever we can. We share our knowledge with them, and we even share materials and tools if we are able to do so.
We have a new perspective, a new way of seeing the world. All this comes from the combination of practice and consciousness. Of course, there is a discrepancy between our practice and that of the world outside – the capitalist world – and that makes our work very difficult.
Many people don’t understand where we are going. They don’t understand why we all get the same wages, and they question democratic management. Unfortunately, some people are not motivated by solidarity and consciousness. They talk about Chávez but they reject socialist practice.
This means that we have encountered many obstacles along the way, and that Equipetrol has sometimes been up against the wall. However, we are convinced that we are on the right path, and we know that socialism is the future.
SERVICES FOR THE OIL INDUSTRY DURING THE BLOCKADE
Leonel Véliz: In 2013 and 2014, we reactivated our plant. We had a contract from PDVSA to make manifolds: a complex system of valves and piping used to gather or distribute oil. We developed a mechanism so that a single person could operate these manifolds as opposed to several workers.
We delivered on time, but unfortunately, the payment came late. Of course, that generated cash flow problems, and, by the time the payment finally came in, the bolívar was highly devalued.
More recently, in 2016, we got a PDVSA contract to build wellheads together with Indorca. We were able to reverse engineer a wellhead that would otherwise have to be purchased in the US. We improved the design, and we delivered two in just a month. In total, we made seven wellheads.
We had support from President Maduro after that, who said on national television: “This is what we need, national production. Contract these people. Give them work for fifteen years.” That contract, however, never came through. Now a private enterprise is producing the wellheads.
The bottom line here is that we need to coordinate production in the country now more than ever. Chávez often talked about sovereignty, about making what we need here in Venezuela. We know that this is possible.
I would also like to add that worker-run factories are in a privileged position to serve the nation: we are our own bosses so we don’t have to serve capitalist interests. We have no bank accounts abroad and, most importantly, we are committed to building a better future for Venezuela!