The Social Economy and the Bolivarian Revolution

Republished with permission from The Bullet, #31, August 10, 2006, a Socialist Project e-Bulletin

  • Going Beyond Survival: Making the Social Economy a Real Alternative
    by Michael A. Lebowitz
  • Socialism for the 21st Century: A Trade Unionist View
    by Jean-Pierre Daubois

Going Beyond Survival: Making the Social Economy a Real Alternative

by Michael A. Lebowitz

Mike Lebowitz taught at Simon Fraser University and is now living in Caracas. His latest book is Build it Now: Socialism for the 21st Century (2006) available from Monthly Review Press.

The rations of slaves were never fixed. And so, too, it has always been possible within capitalism for workers and citizens, through their struggles, to secure themselves some share of the benefits of social labour. Capitalist globalisation and the offensive of neoliberal state policies, however, encroached upon all those gains from past struggles; and the answer to those who were surprised to find those victories ephemeral was the mantra of TINA — that ‘there is no alternative’. Yet, as the devastation of the capitalist offensive has become obvious, opposition has emerged especially in Latin America. Working people around the world look here these days for the demonstration that ‘a better world is possible.’

But, are they right to look here? Is a real alternative emerging here or is it merely a negotiation of better terms in the implicit contract with capitalist globalisation? Is it possible for a new social economy or solidary economy to develop within the nooks and crannies of global capitalism or are those islands of cooperation nurtured by states, NGO’s and church charities merely positive ‘shock absorbers’ for the economic and political effects of capitalist globalisation?

I propose that in the five Latin American countries where opposition to neoliberal state policies has produced recent important governmental changes, there is only one case at present where the changes occurring can make the social economy a real alternative to capitalism. Let me indicate my premises and my reasoning.

Firstly, what constitutes a real alternative to capitalism? I suggest that it is a society in which the explicit goal is not the growth of capital or of the material means of production but, rather, human development itself — the growth of human capacities. We can see this perspective embodied in the Bolivarian Constitution of Venezuela — in Article 299′s emphasis upon ‘ensuring overall human development’, in the declaration of Article 20 that ‘everyone has the right to the free development of his or her own personality’ and in the focus of Article 102 upon ‘developing the creative potential of every human being and the full exercise of his or her personality in a democratic society.’

In these passages (which are by no means the whole of that constitution), there is the conception of a real alternative — a social economy whose logic is not the logic of capital. ‘The social economy,’ President Hugo Chavez said in September 2003, ‘bases its logic on the human being, on work, that is to say, on the worker and the worker’s family, that is to say, in the human being.’ That social economy, he continued, does not focus on economic gain, on exchange values; rather, ‘the social economy generates mainly use-value.’ Its purpose is ‘the construction of the new man, of the new woman, of the new society.’

Beautiful ideas. Beautiful words. But, of course, only ideas and words. The first set comes from a constitution and the second, from the regular national educational seminar known as ‘Alo Presidente’. How can such ideas and words be made real? I want to propose four preconditions for the realisation of this alternative to capitalism and then want to talk about what has occurred in Venezuela.

  1. Any discussion of structural change must begin from an understanding of the existing structure — in short, from an understanding of capitalism. We need to grasp that the logic of capital, the logic in which profit rather than satisfaction of the needs of human beings is the goal, dominates both where it fosters the comparative advantage of repression and also where it accepts an increase in slave rations.
  2. It is essential to attack the logic of capital ideologically. In the absence of the development of a mass understanding of the nature of capital — that capital is the result of the social labour of the collective worker, the need to survive the ravages of neoliberal and repressive policies produces only the desire for a fairer society, the search for a better share for the exploited and excluded — in short, barbarism with a human face.
  3. A critical aspect in this battle of ideas is the recognition that human capacity develops only through human activity, only through what Marx understood as ‘revolutionary practice,’ the simultaneous changing of circumstances and self-change. Real human development does not drop from the sky in the form of money to support survival or the expenditures of popular governments upon education and health; nor is it fostered by the petty tutelage and hierarchical decision-making of statist societies. The conception which challenges the logic of capital is one which explicitly recognises the centrality of self-management in the workplace and self-government in the community as the means of unleashing human potential — i.e., the conception of a social economy, a solidary economy, indeed, of socialism for the 21st century.
  4. But, the idea of this solidary economy cannot displace real capitalism. Nor can dwarfish islands of cooperation change the world by competing successfully against capitalist corporations. You need the power to foster the new productive relations while truncating the reproduction of capitalist productive relations. You need to take the power of the state away from capital, and, you need to use that power when capital responds to encroachments — when capital goes on strike, you must be prepared to move in rather than give in. Winning ‘the battle of democracy’ and using ‘political supremacy to wrest, by degrees, all capital from the bourgeoisie’ remains as critical now as when Marx and Engels wrote the Communist Manifesto.

Are these conditions present in the new Latin American governments on the Left? On the contrary. For the most part, the pattern displays the familiar characteristics of social democracy — which does not understand the nature of capital, does not attack the logic of capital ideologically, does not believe that there is a real alternative to capitalism and, accordingly, gives in when capital threatens to go on strike. (This is a perspective crystallized in the statement of the social democratic Premier of British Columbia in Canada at a time when I was Party Policy chairman — ‘We can’t kill the goose that lays the golden eggs.’) While it is too soon at this point to judge the course of developments in Bolivia, let me suggest that something different has been happening in Venezuela. I want to turn to that now — both what has happened and the current struggles.

The Venezuelan Path

The Bolivarian Constitution does not only stress the goal of human development. It also is unequivocal in indicating that human beings develop their capacity only through their own activity. Not only does Article 62 declare that participation by people is ‘the necessary way of achieving the involvement to ensure their complete development, both individual and collective,’ but that Constitution specifically focuses upon democratic planning and participatory budgeting at all levels of society and (as in Article 70) upon ‘self-management, co-management, cooperatives in all forms’ as examples of ‘forms of association guided by the values of mutual cooperation and solidarity.’

With its emphasis upon a ‘democratic, participatory and protagonistic’ society, the Bolivarian Constitution definitely contains the seeds of the solidary economy, the seeds of socialism for the 21st Century; and, those particular elements continue to inspire the Venezuelan masses. Yet, that constitution also guarantees the right of property (Article 115), identifies a role for private initiative in generating growth and employment (299) and calls upon the State to promote private initiative (112). That constitution, in short, supports continued capitalist development, and this was precisely the direction of the initial plan developed for 2001-7. While rejecting neoliberalism and stressing the importance of the State presence in strategic industries, the focus of that plan was to encourage investment by private capital — both domestic and foreign — by creating an ‘atmosphere of trust’.

To this was to be added the development of a ‘social economy’ — conceived as an ‘alternative and complementary road’ to the private sector and the public sector. But, it is significant how little a role was conceived for the self-managing and cooperative activities by which the ‘complete development, both individual and collective’ of people was to be achieved. Essentially, this was a programme to incorporate the informal sector into the social economy; it is necessary, the Plan argued, ‘to transform the informal workers into small managers.’ Accordingly, family, cooperative and self-managed micro-enterprises were to be encouraged through training and micro-financing (from institutions such as the Women’s Development Bank) and by reducing regulations and tax burdens. The goal of the State was explicitly described as one of ‘creating an emergent managerial class.’

Class struggle, however, nurtured the seeds of that social economy so that it increasingly was seen as the alternative to capitalist development. Even though the initial measures of the government to allow it to pursue its ‘Third Way’ orientation were not an attack on capitalism as such, the response of Venezuela’s pampered oligarchy (supported fully by US imperialism) — first through its coup of April 2002 and then through the bosses’ lock-out of the winter of 2002-3 — mobilised the masses in workplaces and communities and drove the Bolivarian Revolution along a path moving away from capitalism.

As government revenues revived in the latter part of 2003 (with the effective re-nationalisation of PDVSA, the state oil company), new missions in health and education began to demonstrate the real commitment of the Bolivarian government to wipe out the enormous social debt it had inherited. Mission Mercal, building upon the experience of government distribution of food during the general lockout, began in early 2004 to provide significantly subsidized food to the poor (and continues to expand at the expense of the capitalist sector). Yet, the question remained — how were people to survive? How could the growing confidence and sense of dignity felt by the exploited and excluded as they emerged from the education programs be nurtured rather than disappointed?

The answer in part was the creation in March 2004 of Mission Vuelvan Caras (Turn your Faces), a programme for radical endogenous development oriented to building new human capacities both by teaching specific skills and also preparing people to enter into new productive relations through courses in cooperation and self-management. And, the context in which this was occurring was one in which President Chavez was directly attacking what he called the ‘perverse logic’ of capital and stressing the alternative — that social economy whose purpose is ‘the construction of the new man, of the new woman, of the new society.’

While productive activity under these new relations has been expanding (with the number of cooperatives increasing from under 800 when Chávez was first elected in 1998 to almost 84,000 by August 2005), though, how much of an alternative to capitalism can this provide? The new cooperatives fostered and nurtured through Vuelvan Caras are destined to be small and not likely (certainly at their outset) to be major sources of accumulation and growth. Nevertheless, in their emphasis upon replacing the system of wage-labour with one based upon cooperation and collective property, they are a microcosm of an alternative to the logic of capital; and, since the general lock-out, they have been complemented by a drive for self-management and co-management on the part of workers both in state industries and also in closed factories.

In the last year, solidarity rather than self-interest has become a major theme in discussions of the social economy (now renamed socialism for the 21st century). Drawing upon Istvan Meszaros’s discussion (in his Beyond Capital) of Marx’s conception of the communal society, President Chavez a year ago called for the creation of a new communal system of production and consumption — one in which there is an exchange of activities determined by communal needs and communal purposes. We have to build, he announced in his July 17 ‘Alo Presidente’ programme, ‘this communal system of production and consumption, to help to create it, from the popular bases, with the participation of the communities, through the community organizations, the cooperatives, self-management and different ways to create this system.’

At the heart of this conception is protagonistic democracy — the combination of democratic development of goals at the community level and democratic execution of those goals in productive activity. New communal councils (based upon 200-400 families in existing urban neighbourhoods and 20-50 in the rural areas) are a critical part of this process. These institutions are now being established to democratically diagnose community needs and priorities. With the shift of substantial resources from municipal levels to the community level, the support of new communal banks for local projects and a size which permits the general assembly rather than elected representatives to be the supreme decision-making body, the new communal councils provide a basis not only for the transformation of people in the course of changing circumstances but also for productive activity which really is based upon communal needs and communal purposes.

On the side of production, there is a substantial expansion of new state companies, the introduction of co-management in basic industry beginning in the state aluminum firm ALCASA and the creation of a new institution — the Empresas de Produccion Social (EPS). The concept of these new companies of social production is that they both make a commitment to serving community needs and also incorporate worker management. Drawn from a number of sources — existing cooperatives (now committing themselves to the community rather than only collective self-interest), smaller state enterprises and private firms anxious to obtain access to state business and favourable credit terms), the logic of the EPS is to reorient productive activity away from exchange value to use-value — by linking to the community and to the state sector as part of production chains as suppliers and processors. The goal, in short, is to move progressively away from the separation of the collective worker inherent in commodity production to a concept of solidarity within the society.

When you look at this picture, you understand better Chavez’s statement at the 2005 World Social Forum in Porto Alegre about the need to ‘re-invent socialism,’ the need to develop new systems that are ‘built on cooperation, not competition.’ Capitalism, he stressed, has to be transcended if we are ever going to end the poverty of the majority of the world. ‘But we cannot resort to state capitalism, which would be the same perversion of the Soviet Union. We must reclaim socialism as a thesis, a project and a path, but a new type of socialism, a humanist one, which puts humans and not machines or the state ahead of everything.’

Which way Venezuela?

It should be apparent from the premises with which we began that only in Venezuela is there at this time a real challenge to capitalism (as opposed to fostering survival strategies and negotiating new terms in the implicit contract with capital). But, is Venezuela succeeding? Certainly, there is an attempt to understand the logic of capital, the effort to attack capitalism ideologically in a battle of ideas and development of the conception of an alternative to capitalism. But, what about the actual creation of that alternative?

In Build it Now: Socialism for the 21st Century, a book which will be published next month, I wrote the following about the Bolivarian Revolution:

“The economic revolution, in short, has begun in Venezuela but the political revolution (which began dramatically with the new constitution but requires the transformation of the state into one in which power comes from below) and the cultural revolution (which calls for a serious assault on the continuing patterns of corruption and clientalism) lag well behind. Without advances in these two other sides, the Bolivarian Revolution cannot help but be deformed.”

While the Bolivarian Revolution has definitely succeeded in providing enormous hope and dignity for the poor, it faces many problems and its success will only occur as the result of struggle. Not only a struggle against US imperialism, the champion of barbarism around the world, which is threatened by any suggestion that there is an alternative to its rule. And, not only against the domestic oligarchy with its capitalist enclaves in the mass media, banks, processing sectors and the latifundia. Those are struggles for which the Revolution must be prepared and for which solidarity with that revolution is essential. But, the really difficult struggle, I suggest, is within the Bolivarian Revolution itself.

Many problems have their origin in one question: who are the subjects of this revolution? It is clear who have been the principal beneficiaries — the poor (and especially women) and, thus, its most passionate supporters. Yet, the further development of the revolution requires that not only the needs of people but also their transformative activity drive the revolutionary process.

In this respect, the creation of the communal councils is an absolutely critical step in this process because it creates the space for the self-development of revolutionary subjects. At the same time, however, worker management in what are called ‘strategic’ state industries has moved backward, and these reversals have demoralised revolutionary workers; confining them to the adversarial role that they play in capitalism, it reinforces all the self-oriented tendencies of the old society. Without democratic, participatory and protagonistic production, people remain the fragmented, crippled human beings that capitalism produces. Further, if state firms remain characterised by hierarchical decision-making, how long before producers in the companies of social production (EPS) articulated in production chains with them discover that they are themselves little more than associations of collective wage-labourers? Where, then, is the social economy as an alternative to capitalism?

There are, in short, significant contradictions within the Bolivarian Revolution at this time. For some Chavists who want Chavez without socialism, the process has gone far enough. To the extent, then, that there is resistance to decision-making from below (whether in workplaces or communities), the self-development of people will advance only through struggle. But, there is at this point no means of coordinating among organised workers, cooperative members, informal sector workers, peasants and professionals who are prepared to fight for protagonistic democracy in the workplace and in the community; there is no united force from below demanding transparency and prepared to fight against corruption and the deformation of the Revolution.

To carry the Bolivarian Revolution forward and to demonstrate the possibility for that ‘new type of socialism, a humanist one, which puts humans and not machines or the state ahead of everything,’ it is essential to create institutions that foster the development and coordination of revolutionary subjects — people who transform themselves in the course of struggling for a better world. As Hugo Chávez wrote from prison in 1993, ‘the sovereign people must transform itself into the object and the subject of power. This option is not negotiable for revolutionaries.’

* This essay was originally prepared for a presentation at the IVth International Meeting of the Solidary Economy at the University of Sao Paulo, Brazil 21-23 July 2006. It was organized by NESOL which conducts research and activities related to economic alternatives. See its website at http://www.poli.usp.br/p/augusto.neiva/nesol/.


Socialism for the 21st Century: A Trade Unionist View

by Jean-Pierre Daubois

Jean-Pierre Daubois is long time union activist and socialist who began to work on the production line at the General Motors assembly plant in Ste Therese, Quebec in 1977. Later he became an electrician and ultimately became president of the skilled trades at the facility. He worked there until the plant closed in 2002 and then became one of the main leaders of the impressive, but ultimately unsuccessful, mobilization to keep the facility open. Two years ago he travelled to Venezuela to learn more directly about Chavez and the Bolivarian revolution; he has followed events closely since. When Greg Wilpert, the respected editor of Venezuela Analysis wrote an article on ‘The Meaning of 21st Century Socialism for Venezuela’, Jean-Pierre was moved to write the following response. Socialist Project reprints it here as part of the international discussions on the evolution of Venezuela as well as questions about our own labour movement in Canada. For Wilpert’s article, see http://www.venezuelanalysis.com/articles.php?artno=1776

Dear Mr. Wilpert,

I loved your article ‘Socialism for the 21st Century’. It is well balanced and points out the incredible achievements of the Chavez government, and also some of the dangers which are coming as much from the inside as from the outside. It is most important to discuss the internal dangers; the future of the Bolivarian movement needs this very much.

I have been to Venezuela and witnessed the dangers of the personalization of the revolution around Chavez. Although I am convinced he does not want that, the weight of the political tradition of caudillismo in the culture is strong in Venezuela as well as in Latin America in general. Associated with this, as you point out, are the dangers of the bureaucratization of the revolution and the creation of a sort of nomenclatura — which again Chavez clearly does not want.

I am working class myself, and have been working in industry here in Canada for almost 30 years (at General Motors). I raise this because I want to expand on what you have perceived as one of the dangers for the revolution — the political immaturity of the working class, which is sadly illustrated by the recent collapse of the UNT convention.

It is not so simple to develop worker controlled industries. Workers have to understand that even if they are freed from bosses pushing them around and pressuring them for productivity, they still have to develop quality and productivity in a socialized economy. It is not clear today in Venezuela if workers are fully aware and prepared to address such issues.

A very good friend of mine is from Chile. He is a political refugee who has been in Canada since 1973. We worked at GM together for almost 27 years and of course he, like all of us, went through the numerous restructurings, rationalizations, down-sizing, and other corporate niceties until our plant was closed in 2002. Through these years my friend lived the craziness of our capitalist system.

Two years ago he left for Venezuela and worked there — not as an intellectual, but as a worker. He was working in small companies, but still he got a sense of the attitudes of Venezuelan workers toward work and productivity. It was a shock to him; he was surprised by the low motivation and low productivity of workers.

The other interesting thing he told me came from conversations he had with a Cuban doctor living near his house in a working class area. He had made friends with this doctor and they chatted quite a bit. One day he asked him: “What do you think of the people of Venezuela?” The doctor had this interesting answer: “Chavez is giving them too much too fast — healthcare, education… it all comes without a fight.”

I found that interesting because one of the dangers that you discuss in your article is that of people becoming dependent on authority — the benevolent authority that will solve their problems. This is a passive attitude. I understand that Chavez tries to overcome this situation, but it is there. It is an inheritance from the past, when the old parties handed down favours here and there. It is one thing to condemn such practices; it is something else to extirpate it from people’s conscience. The comment of the Cuban doctor strikes at the heart of the internal political challenges: how to bring about a nation which will take charge of itself without a benevolent state/leader to “take care of it for you”. That is the greatest challenge for socialism for the 21st century.

Allow me to make a parallel here. For a long time, I was an elected union rep and participated in bargaining. The union’s strategy in negotiations with the Big Three automakers is pattern bargaining, which means targeting the company least inclined to accept a strike and then concentrating on it to establish the pattern collective agreement. That pattern would then be imposed on the other companies. It worked wonders for decades. Workers did enjoyed a steady increase in their standard of living: better pay, more holidays, more vacations, better insurance coverage, better benefits in general, better working conditions, etc. And the pattern bargaining strategy allowed it to happen practically without conflict and/or strike. I started in the industry in 1977, and I had a 3-day strike in 1978, 1 week in 1982, 3 weeks in 1996, and that’s it.

The consequence (unforeseen probably) was that workers take it all for granted. They think that it is “their absolute right” and that corporations “owe it to them”; that the company is only paying them what they are worth; and that the union does not have much of influence on all that. Basically, what they get is NORMAL and of course MINIMAL, even though as auto workers they earned much more than any other sector of the working class.

In an atmosphere of such complacency, and with a total misunderstanding of how gains really do come about, what do you think happened when GM announced the plant closure? Do you think workers rebelled against the corporation which was about to deprive them of their jobs? No way! The rebellion was against the union, which was supposed to have the power to prevent that (though how you have power without mobilization is unclear). It was the union for not having prevented the closure that failed them. Not the corporation, not globalization, not capitalism and its rules — the union failed them. In other words, the workers had been handed down great gains by a very smart and dedicated union, but the same workers did not understand the first thing about capitalism and why they were “winning” for a time, and then why they were suddenly on the chopping block in that globalized, capitalist economic system.

I know that comparing a union issue in classic bargaining with the Bolivarian revolution seems out of place, but the mechanism of not having to build, piece by piece, your own social conquests and having a benevolent leadership getting it for you is similar. It leads to an attitude of passivity and complacency, and those attitudes are present in Venezuela’s working class now.

Chavez, by crafting this catchy phrase “socialism for the 21st century” has made clear that he wants to develop something different from Eastern-European, state-run socialism. Chavez has left the debate on “socialism for the 21st century” to his people, and debate they have over this, at length.

NOTE: I do not put Cuba in the same category as Eastern Europe. Cuba was and is under constant political and economic boycott and sabotage, and under permanent military menace since day one. Cuba has to protect its advances under enormous pressure and that reality has created some “rigidity” in its political system. But Cuba has nothing to do with the state-run socialism of the former Soviet Union. In Cuba, the revolution did manage to maintain a strong credibility with the people. If they hadn’t maintained complete credibility, they would not have survived after the collapse of the Soviet Union; it is as simple as that.

I think that one of the most original things about Chavez is that he wants his people to evolve and to reach toward socialism. He is willing to push in that direction, but ultimately he wishes for the people to have the political maturity to strive for it by themselves, and most importantly to TAKE responsibility for it, too.

In other words, Chavez puts challenges to his people. He points to the “star” to attain, and challenges them to attain it by their organization, conscience and will. That’s very rare in politics — forcing your partisans to think about their own attitude and challenging them to act both on society and on themselves, too.

In several articles by Michael Lebowitz on the debate over co-management and the traps to avoid in implementing it (i.e. bureaucracy, top-down decisions, workers not taking charge) you could read about some of the internal limitations the revolution is suffering right now. You are right in your article about the internal contradictions. I would only add that workers have not yet developed the maturity for taking charge and that Chavez, I think, is fully aware of this. He is trying to push them, to challenge them. Clearly Venezuela has decades of underdeveloped, corrupted, lazy, grab-from-the-till mentality to overcome. Your article is helping to put the problem on the table. Chavez has time … for now. The US is bogged down in Iraq; if they were not, they certainly would have undertaken more serious action against Venezuela. This conjuncture allows for a Chavez to develop a project for a different world and for Morales as well to develop his project in Bolivia, but it is only a question of time before more aggression is mounted. In that sense they have to develop their revolutions faster rather than slower.

The future of mankind is at stake here, and I am not trying to be dramatic or to say that Chavez is THE saviour. I am telling you that it is only circumstantial that the US is not attacking with more aggressiveness. We — socialists — need to put before the eyes of the world an example of socialism that cannot be associated with the state-run model of Eastern Europe. That model did not inspire anybody in the working class; that model did not make anybody dream that ANOTHER WORLD IS POSSIBLE. The experience of the Bolivarian Revolution has the potential to generate such dreams in the conscience of millions and millions, and at this point in history we need that desperately, NOW more that later in the century. It is in that sense that the Bolivarian revolution is crucial NOW.

If you remember the invasion of the island of Grenada during Reagan’s time, or the Allende experience in Chile, both were democratically elected socialists who were overthrown. Why? Of the many reasons, one clearly is that the US cannot allow socialism to be seen as a democratic alternative. Socialism MUST, for the US, be associated with the Stalinist regimes of Eastern Europe.

Talking specifically about Grenada, how this island of 100,000 inhabitants was a threat to US is simple: it was a democratically-elected socialist government that could inspire the poor of the entire continent, and that is not to be allowed by the US. If they invaded Grenada to prevent it from becoming an inspiration, imagine how pissed they are that Chavez is still alive and well….

The Stalinist regimes of Eastern Europe were not attractive — this is an understatement — for the working class of the developed countries. The Bolivarian revolution, with the ALBA and all of it, has such potential that it is a most dangerous enemy for the US. This is why I do not hesitate to say that the Venezuela experience is crucial for mankind. It must succeed, and time is not entirely on their side. This is why I am concerned with the collapse of the UNT convention. How come the core of the Venezuelan working class can’t organize? What kind of message is this for the enemies? How come the UNT crumbles under bitter infighting, when all of the five tendencies are each claiming to be more Chavista than the others? My thirty years’ experience in a trade union tells me that this is a sign that the focus of the tendencies is directed toward an internal power struggle more than toward differentiating themselves by their actual accomplishments in the daily struggle of the working class. That is a sign of an organization that lacks solid roots even if they have big numbers on paper.

It seems that “politicking” and bureaucratic manoeuvring is taking charge instead of politics, and that is a bad sign; a sign of political immaturity, a sign that the working class still has to overcome the legacy of the old political system. The leaders of the five factions of the UNT shall, if they are genuine Bolivarians, realize that while they are allowing themselves to commit to infighting, Big Brother is watching…

In solidarity,
Jean-Pierre Daubois