VENEZUELA: US COUP ATTEMPT DEFEATED BY WORKERS!

( June 2002)

In a counter blow that has stunned US imperialism, a coup it backed against the popularly elected Government of President Chavez, has rapidly been broken by the strength and determination of the Venezuelan working masses. On the weekend of 11- 14th April, after more than ten months of continued planning, a plot to remove not only President Chavez but every single democratic gain made in Venezuela over the last 4 years shattered against the resistence of the poor and their democratic allies. In Caracas, Venezuelans in their thousands stormed to the Presidential Palace forcing the cancellation of the swearing in of the plotters "interim" Cabinet, effectively placing them under citizens' arrest. They announced that they would remain until the elected President, Hugo Chavez was returned to his Office. With loyal troops actually waiting in the Palace basement corridors, the chief of the paratroop division then ordered the trapped would be dictator to release President Chavez .

In the following account one issue stands out. Venezuelan oil is central to the strategic programme of US imperialism. It needs it to breach the OPEC quota agreements and it wants privatisation of the country's oil resources to safeguard US global plunder.

Thursday April 11th: Murder

The coup itself was organised on the back of a strike by oil executives and managers of the State Oil company PDVSA called to reject the Government's aim of using the huge state oil corporation's activities for the nation. It lead to a political demonstration by the middle class and well paid oil workers against the State President on April 11th. The demonstration was set up by a clique preparing a coup.

This coalition consisted of the following. Firstly the Chambers of Commerce leadership headed by Pedro Carmona. Many in the business community eg in textiles, were finally aligned against the Government because of a 20% increase in the minimum wage to be introduced in April which they are refusing to pay. Secondly the CTV oil union leadership which had been in direct disobedience of new laws requiring fair and free union elections and was keen to abolish them. Thirdly, instinctively reactionary, wealthier, older and senior sections of the army reared on US aid. Fourth, the catholic church leadership offended by the new Constitution. Fifthly, the richest business leaders, opposed to any real democracy, including Gustavo Cisnaros, a media and drinks mogul, billionaire and a fishing friend of President Bush. These were anxious to stop Chavez halting privatisation, especially of the state oil industry. That morning as the march prepared to set off, Venezuelan political and business leaders met privately, in true plutocratic style at the Cisneros mansion, to welcome the new US ambassador. Cisneros's TV company Venevision would give non-stop coverage to the demonstration that afternoon.

The demonstration, headed by governors and mayors opposed to President Chavez demanded his resignation. With the five TV chains, including that of Cisneros, plus Radio Caracas Television, Televen and Globovision - upset over having to pay taxes like any other business for the first time in their history - running free advertisements every ten minutes inciting their viewers to join the march, and with the 40,000 member CTV oil workers union, the National Chamber of Commerce and Industry and the Catholic Church hierarchy pulling out all the stops to create the illusion of a popular revolt, they managed to get about 150,000 people into the streets of Caracas to protest against Chavez.. The stock market leaped by 10%.

Diverted without warning by the organisers from its route to the National Oil Corporation headquarters, it was marched to the Presidential palace - Miraflores. There they faced a smaller pro-Chavez demonstration which had been rapidly mobilised in response. The pro Chavez national guard, although provoked with sticks and stones by demonstrators at the front of the anti-Chavez march, kept the two groups separate .

Trained provocateurs then fired shots from a rooftop into the pro-Chavez group standing by a their podium. The first two killed were a legal secretary and an archivist, both who worked in the Presidential building. A 10-year-old girl was then taken away, fatally injured. Snipers aimed more shots at the 'Chavista's' many of whom took shelter behind the palace wall. In the subsequent shooting 17 people were killed (most shot from high angles into the head ) and over 100 were wounded in the confused cross fire that broke out between other armed opposition gunmen and a few government supporters. Eventually 4 snipers in civilian clothes were arrested – according to Government witnesses - including a Salvadorean and an American. The attempt by Chavez himself to broadcast an explanation on TV was then blacked out. A group of ten Army and Navy generals arrived at the palace headed by General Efrain Vazquez (over 80 senior officers participated in the coup).

Friday April 12th: Shock

At 3am Friday morning a tearful Environmental Minister, Ms Analisa Osorio, emerged announcing 'He's under arrest', along with Vice President Cabello. The military junta that had arrested and imprisoned the President at gunpoint without having legally charged him with any crime, installed national Chamber of Commerce and Industry chairman, oilman, and number-one coup leader Pedro Carmona as "president."

Carmona had been waiting at Gustavo Cisneros's Venevision TV station where he had met with other conspirators the previous afternoon awaiting the results of their provocation. From there he drove to the Presidential palace to take up his post. Later Cisneros and other media executives arrived in limousines at the Palace, where he was called twice by Otto Reich, assistant US Secretary of State for 'hemispheric' affairs, from Washington.

Radio and television immediately announced the 'resignation' of Chavez and began broadcasting upbeat messages: 'Venezuela is finally free' was the banner across all private TV channels. The government went into hiding. Interior Minister Rodriguez was hunted to his home and arrested. Many fled for their lives. Pro Chavez journalists were beaten and harassed by the 'Technical Judicial Police' on the pretext of searching for arms. A mob of 500 assaulted the Cuban embassy, which sheltered 4 supporters of President Chavez. A witch- hunt began. The media kept repeating footage of the swearing-in ceremony of the 'interim president', which was followed by images of tranquil streets. AP, Reuters, the NY Times, CNN and many other English-language media sources repeated the lies that the shots came from armed Chávez supporters. They repeated this unsubstantiated speculation as fact over and over and over again. White House Press Secretary Ari Fleischer claimed that Chavez "ordered" the shootings. The arrested snipers were themselves released by Carmona's clique the next day.

Among Carmona's first acts in the "Transitional Junta Decree" on Friday was to declare the 1999 Constituion void, promising to restore the pre 1999 bi-cameral system. He abolished the elected national congress, disbanded the constitutionally established Supreme Court, delayed new elections up to a year and changed the name of the country from the Bolivarian Republic of Venezuela to the Republic of Venezuela. He dismissed the president and magistrates of the Supreme Tribunal of Justice (TSJ), Comptroller, Attorney General, Official Ombudsman and members of the National Electoral College (CNE) and reinstated ex-General Lameda as President of PDVSA. The decree also suspended 48 laws passed Constitutionally by the Chavez government and Congress in 2001. The response of the western mass media, including the "liberal" New York Times was to applaud these steps as measures necessary to preserve and enhance 'democracy' in Venezuela. The White House blamed Chavez for 'undemocratic acts' and gave tacit backing to Carmona. Sharp contrast indeed to the dramatic threats made by Clinton against the soldiers and indiginous peoples that overthrew the pro- US Government in Ecuador in January 2000!

Thus, in the name of stopping an "autocrat," a "dictator," an "authoritarian," a "strongman," epithets used by almost all the western establishment press, the coup installed a real dictator, Pedro Carmona: un-elected, yet who began a house-by-house witch hunt to round up cabinet members, congressmen and political leaders in Venezuela.
''We cannot allow a tyrant to run the Republic of Venezuela,'' said Navy Vice Adm. Hector Rafael Ramirez, at the precise moment that he was installing a tyrant to run the Republic of Venezuela. The PDVSA, with 'new' leadership, now announced that it would not maintain the OPEC quotas, and immediately suspended oil exports to Cuba! The price of oil fell. Just what the USA wanted.

Saturday 13th: Workers strike back

A 'Government' was named that included several members of the ultra conservative Catholic Opus Dei, but excluded key military and Trade Union figures which created an immediate split among the plotters. Alarmed at the precedent being set, other Latin American leaders now refused to recognise the new 'government'. Mexico, Brazil, Argentina and others condemned the coup. The 19 nation Rio group of States declared their opposition. On Saturday 13th the US Ambassador met Carmona, instructed by Reich to get him to reinstate the National Assembly, since he was in violation of the Constitution.

By Saturday morning thousands of workers had gathered outside Fort Tiuna where Chavez was held, demanding his freedom. Uncertain what to do his captors flew him to a Navy base at Turiamo. The most crucial turning point of all was when rank-and-file soldiers and officers at the nation's largest Army Base in Maracay, soon joined by troops in nearby Valencia, rejected the military junta and began the 'counter-coup'. The Speaker of the National Assembly rejected dictator Carmona's decree abolishing the elected legislative branch of government (members announced that come Sunday, they would hold a formal session anyway).

By the afternoon huge protests had erupted in the slums of Caracas - los Ranchos - against the military-installed dictatorship. The five big TV chains of Venezuela had made a concerted decision to not report demonstrations against the Coup. Huge crowds had surrounded the palace, demanding the return of Chavez. "The only weapons we have are lessons we give to the poor - to help them fight for their rights"..(Yarguin, a farmer, quoted in the Caracas News). During the day several TV stations were threatened or taken over by Chavez supporters and the office of the anti Chavez mayor of Caracas was attacked. By 3pm, several Chavez deputies had returned to the Palace and were calling round the country to find out what was going on. A dozen people who were working for the interim government had been taken to a room in the basement for their own safety. Reports came in from around the country, barracks by barracks, that the military was rebelling against the coup. The television continued to broadcast a steady diet of soap operas, saying nothing about the huge mobilisation, which was now making a deafening racket outside. In the streets of virtually every city and town in Venezuela, at least a million poor, as Chávez had predicted the day before the coup, "came down from the hills".

In Caracas, Carmona's troops began firing upon crowds indiscriminately, the very behavior it had accused the Chávez government of when it created the pretext for the military coup. Morgues and hospitals filled with the dead and wounded civilians - 49 more dead and 332 wounded to add to Thursdays score. Then a military junta leader admitted on the radio at 6.40 pm that Chávez had never resigned and the military second in command at Miraflores announced on TV that he would take charge of the Palace until he saw proof of Chavez's resignation.

Carmona had now left Miraflores for fort Tiuna finding military coup leaders boiling over his decrees. He made an announcement of TV reversing the decrees and resigned in favour of the real vice president Cabello. He was then arrested by DISIP, the political police.

Then came the news that Chavez had been freed and was taking a helicopter to Miraflores. The crowds went wild. The President returned very late that night. On Monday the stock exchange fell by 8.14%. The oil price rose again.

Never before in modern times has an elected president been overthrown by military commanders, his successor inaugurated, and then the ousted leader returned to power on the wings of a popular uprising.

In Washington by Sunday the OAS, in a statement watered down and then signed by the USA in order to retain 'credibility', condemned 'the alteration of the constitutional order', invoking the new 'Democratic Charter' approved in Lima in September 2001.

The Background

The US Government objects to the Venezuelan government and wants 'regime removal'. Why? First, this President is the first ever openly to side with the poor and attempt to deal with the poverty endured by 80% of the people. To do this means to challenge the existing system of economic plunder. So new policies towards the oil industry in particular, which provides 75%- 80% of export revenue and 40%-50% of government revenue, had to be formulated. The new president immediately took the initiative within OPEC to strengthen its ability to maintain oil prices, to the detriment of the US and other key industrial importing states. President Chavez is committed to use the enormous oil revenues to reduce the wholesale poverty through universal education, health care and rural resettlement and development programmes.

As the world's fourth largest oil exporter (and 3rd largest OPEC producer), Venezuela has been the object of constant US interference for the last century. Venezuelan oil was used to shatter the 1973 OPEC embargo and actively breaks OPEC targets. It is critical for US policy. The surge in U.S. oil imports, from 30 percent of domestic consumption in the mid-1980s to 54 percent last year, leaves the American economy heavily reliant on outside sources. Venezuela is the third largest supplier to the USA, 1.3 million barrels a day. The political conflicts in the middle east make oil from the Americas vital. Democracy in Latin America has always been disposable for US imperialism. It is now even more dangerous as an obstacle to cheap access to secure oil supplies.

President Chavez has thus sought to establish a regional 'Bolivarian' group to restrain US influence, developing strong relations with the Cuban people and condemning US support for Colombian State terrorism (Plan Colombia). The US was further frustrated when on February 1, 2001, Chávez placed civilian statesman Jose Rangel as head of the nation's armed forces, after it was discovered that some of the military establishment were conspiring with Colombia's vicious AUC terrorist organization to form paramilitary death squads in Venezuela. In August 2001 it was announced that the US military mission at the countries main military base would be closed and Cuba and Venezuela signed an Agricultural Cooperation Agreement under the auspices of the UN FAO, whose director Jacques Diof called it the first example of 'South-South' cooperation. The October 2000 agreement to provide 56,000 barrels of oil a day to Cuba on preferential conditions, angered the US.

The Contradictions in the Reform.

Chavez has thrown his weight against the 'Washington consensus'... 'the poison we carry within us' as he has called it, but only to the extent that he wants 'fairer terms' by which to deal with the USA. He was delighted to learn that foreign direct investment in Venezuela had increased by 28.9% in 2000 to $4.110 millions (3% of the GNP), from the $3.187 billion of 1999, when the price of oil had fallen to $10 a barrel, although this sum was still lower than '97 or '98, the year he was first elected. Direct non-oil related investment was $449 million in the first 5 months of 2001, 83.4% more than the same period in 2000. The US, Holland and Spain are the largest investors in this total. However with the economic slowdown and then the ' November measures' new capital will be harder to come by. Capital is invested to exploit labour. Ameliorating exploitation will not attract Capital! Venezuela is dependent on investors and markets that can only expand at the expense of the poor!

The poor demand action

President Chavez inherited a $21 bn. debt in state wages and pensions in 1999! The GDP per capita had been declining by 1% per annum since the early 1980's. Previous governments had refused to meet the real needs of the masses (see FRFI 152). As a result of Chavez's efforts, and medical support from Cuba, the infant mortality rate has fallen from 24 to 17% since the new Government came into office, the official urban unemployment rate had fallen from 18% to14% by August 2001. He has promoted educational reform which schooled over 1 million children for the first time and doubled investment in education; introduced a large-scale micro-credit program for the poor and for women; reformed the tax system which dramatically reduced tax evasion and increased government revenue; tripled literacy courses.

At the visit of President Castro to Venezuela in August 2001, as at all events addressed by Chavez, thousands of the poor attend holding scribbled notes and letters to him, appealing for individual help in every way, for homes, jobs, medical help, that the State could still not provide. The downturn in the world economy during 2001 and the September 11th events then saw oil prices falling eg to $19.37 (Brent) by 6th November, well below Opec's aim of $22-
28. Thus oil revenue in 2000-1 was $13bn, in 2001-2 only $8bn.

On November 13th 2001, as a result of growing pressure by the masses, President Chavez, by-
passing the legislature, announced the enactment of 49 economic laws, causing great anger in the ranks of the private sector and its political representatives. These laws will enable the government to determine land use, irrespective of market conditions. They increase royalties paid by private, notably US, oil companies from 16.6% to 30% on new investments, and require a minimum of 51% State share in joint ventures. A fisheries law aims to help traditional fisherman, regulating fishing businesses and enforcing taxation. In effect these steps represent the putting into practice of the new radical Constitution, a nasty pill for Imperialism which it wants to be rid of.

But reforms like this need higher oil prices even to start with. As a result of continuing uncertainty in oil prices, on Febuary 12th, 2002, and approved by the IMF, the state budget was slashed $2bn, to $24.b bn. The GDP is $110 bn. State debt was still to rise 1% to $8bn, as oil prices fell to $16 per barrel. Central bank profits, VAT reform, a new bank debit tax and other changes were to be employed to support state spending at this new low level. Spending cut backs will affect regional and municipal governments. The currency band system was replaced with a 'dirty' floating rate with a new reference price system set by central bank. On the first day of a new system of trading (18th February) the Bolivar fell 23%, this may lead to inflation of 30%. Interest rates shot up as liquidity contracted. Fitch and Moody's both (27th February) reduced the status of the economy for investors. All this threatened the middle class as well as the poor. The limit to President Chavez's reforms, his dilemma, is clear.

The rich demand action

In July1999, Luis Garcia Morales, then Captain of the Guardia Nacional (a key police force) created a 'Patriotic Junta' to defeat Chavez and even admitted that ideas of assassination were discussed by it. The right wing has been reconstructing its political fronts, using a new party, 'Primero Justicia', founded to attract the young middle class. The Chambers of Commerce seized upon the13th November 2001 measures to call a 12 hour stoppage against the Chavez Government on 10th December, and arranged middle class marches on 23rd January and 27th February 2002. In February the head of the PDVSA was replaced to ensure compliance with Government policy to stop the trend to privatisation. Now the privileged managers of the state oil industry (PDSVA) threatened to strike against the changes. US oil companies, Chevron-Texaco, and in particular Exxon Mobil and Conoco which have worked closely with the old board, objected to the new royalty payments. Rear Admiral Carlos Molina (ambassador designate to Greece) became the 4th senior officer in 2 weeks to demand the President's resignation, joined by General Nestor Gonzalez in April. The labour aristocracy (the CTV Union) signed a 10 point agreement with the Chambers of Commerce and in agreement with the Catholic church ' to reduce poverty not by redistribution but by increasing productivity and increasing wealth', by which they mean increasing the rate of exploitation and so expanding the production of surplus value for private owners and their gang.

With no political party to win an election the bourgeoisie now resorted to posturing with its little 'Bonapartes'. Press speculation about a 'Bloodless military coup by installments' by the air force and navy dissidents continued.

Preparing the coup of April 11th

While the unholy alliance between the Chambers of Commerce (the millionaires club), the high earners in the CTV 'trades union' and the catholic church was being cemented, a series of visits to Washington were made by senior military, political and labour aristocratic officials, seeking approval for the removal of Chavez. Here they either met Otto Reich or members of his team. This US Assistant Secretary of State was organiser in the terror campaign against the Nicaraguan Sandinista government. He protected and sought asylum in the US for terrorist Orlando Bosh, who together with Luis Posada Carriles was responsible for the blasting of a Cuban civil aircraft with 73 passengers on board.

By November exchanges between US officials and plotters were so regular that, for appearances sake, the US Ambassador asked the US military to stop them. Hardly a real likelihood given President Chavez's later condemnation of US bombing in Afghanistan.

At the end of February a six week campaign of strikes and protests was then started by the CTV and the managers of PDVSA, effectively against the Government's anti-privatisation steps. Oil shipments to Cuba were blocked. Nevertheless the strike was losing steam despite 2 killings on the 5th April and assaults on employees trying to work in various locations on the 9th April. For "two weeks e-mails circulated containing detailed plans of the confluence of events - the impact of the PDVSA stoppage, the business-labour strike, and the moment when the armed forces would step in – and how they would lead to Mr Chavez being toppled" (Financial Times 13/14 April p6). Although the precipitating event seems to have been the call for an embargo on oil to the west by Iraq and Libya on April 8th and 9th 2002 (Iraq's oil almost all goes to the USA) in response to the Israeli assault on Palestine, unexpectedly high deliveries of oil to the commercial stock and US strategic oil reserve, to offset losses from Venezuela during the week after the coup attempt, indicate a previously well prepared plan.

Some TV channels recorded statements from the military plotters a few days before the coup, ready to broadcast.. Molotov cocktails were found at the offices of the opposition Democratic Action Party on April 10th.

Clearly Chavez has exposed and can now legitimately clear out, in one sweep, the most dangerous opponents of democracy in Venezuela. His opponents however are already reorganising , determined to defeat him.