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  1. Venezuela • Participatory Democracy; Participatory Economics

  2. Opposition to, and Consequent Radicalization of, Chavez • Coup in April 2002 • Oil Shutdown December 2002 (Management lockout, administrative and professional strike, and sabotage of oil industry) August 2004 Recall Referendum • In January 2005, Chavez announced that that his government build a “Socialism of the 21 Century”

  3. Constitution of 1999 • Chavez’s election in 1998 gave him a mandate for widespread political reform • In April 1999, Referendum Passed to Invoke Constitutional Assembly

  4. Constitution of 1999 • The Constitutional Assembly was elected with members who were pro-Chavez • The Constitution of 1999 was an essential part of the program for political and economic reform

  5. Five Branches of Government • Executive • Judicial • Legislative • Citizen Branch • Electoral Branch

  6. Electoral Branch and Citizen Branch • Both the Electoral Branch and Citizen Branch have “Watchdog” functions. • The Electoral Branch ensures that election procedures are properly complied with

  7. Citizen Branch • Purpose: To ensure that all other branches comply with their functions • Subdivided into: • Defender of the People/ Human Rights Defender: • Ensures that the State does not violate Constitutionally Guaranteed Human Rights • Attorney General • Protects Citizens from other Citizens • Comptroller General

  8. Constitution Includes Rights of Liberal Democracy • Right to Due Process of Law • No Ex Post Facto Laws • Right to an Attorney • “Double Jeopardy” Clause • Right against Self-Incrimination • Right to privacy in one’s home; protection against unwarranted state intrusion

  9. Freedom of Speech • Everyone has the right to express freely his or her thoughts, ideas or opinions orally, in writing or by any other form of expression…and no censorship shall be established… Anonymity, war propaganda, discriminatory messages or those promoting religious intolerance are not permitted…

  10. Right to Information • “Everyone has the right to timely, truthful and impartial information, without censorship, in accordance with the principles of this Constitution…”

  11. Affirmative and/or Economic Rights • In addition to the “negative” rights –that is, the rights to be free of an overbearing state, there are also “positive” rights – that is, certain guarantees – social and economic-- provided by the state.

  12. Right to Housing “Every person has the right to adequate, safe and comfortable, hygienic housing, with appropriate essential basic services, including a habitat such as to humanize family, neighborhood and community relations. The progressive meeting of this requirement is the shared responsibility of citizens and the State in all areas.”

  13. Right to Health Care “Health is a fundamental social right and the responsibility of the State, which shall guarantee it as part of the right to life. The State shall promote and develop policies oriented toward improving the quality of life, common welfare and access to services. All persons have the right to protection of health, as well as the duty to participate actively in the furtherance and protection of the same…”

  14. Right and Duty to Work “All persons have the right and duty to work. The State guarantees the adoption of the necessary measures so that every person shall be able to obtain productive work providing him or her with a dignified and decorous living and guarantee him or her the full exercise of this right. It is an objective of the State to promote employment.”

  15. Basic Material Needs “Every worker has the right to a salary sufficient to enable him or her to live with dignity and cover basic material, social and intellectual needs for himself or herself and his or her family.”

  16. Participatory Democracy • “The participation of the people in the formation of, execution, and control of public administration is the necessary means for achieving the involvement that ensures their full development, both individual and collective. It is the obligation of the State and duty of society to facilitate the generation of the most favorable conditions for putting this into practice.” – Constitution of Venezuala

  17. Methods of Participation • Referenda • Local Public Planning Councils (CLPP): Purpose is to make plans for municipalities, and ensure that they are properly executed • Social Audit: The right of any citizen to audit any public body • Cooperatives

  18. Economic Policies • Can be divided into: • Social Democratic & Keynesian • Participatory/community-based socialist experiments (21 Century Socialism)

  19. Social Democratic and/or Keynesian • Currency Controls • Redistribution of wealth via land reform • Social Programs • Progressive taxation • Trade Restrictions

  20. Creating a “Social Economy” • The notion of the social economy has evolved over time. It has come to include: • Microcredit • Support for cooperatives • Endogenous development • Industrial co-management • Social Productive Enterprises “Nobody is the chief here. We are the owners of our own decisions.”

  21. Microcredit • Government has created several microcredit banks • 2001 Banking law requires all banks to set aside at least 3% of credit for micro-finance • Microcredit from private banks, from 2004 – 2005, increased by 140% • In 2004, a Microcredit program was instituted to help Columbian refugees

  22. 2001 Banking law requires all banks to set aside at least 3% of credit for micro-finance

  23. Support for cooperatives • Constitution explicitly recognizes cooperatives as a means for participation in social and economic life • “National Superintendancy of Cooperatives” charged with facilitating cooperatives • Number of Cooperatives increased from 763 in 1998 to over 100,000 by 2005

  24. Endogenous development • Defined by the Chavez Government: • 1. Based in existing capacities and resources • 2. Motivates community participation in planning of the economy, via new forms of organization, such as cooperatives and social networks • 3. Organized from below towards above • 4. Based on the values of cooperation and solidarity • 5. Uses appropriate technologies without compromising environmental equilibrium

  25. “Mission About Face” • Begin in early 2004: To identify “Nuclei” for sustainable endogenous development • Provide skills, training, and support for unemployed workers to begin cooperatives in fields where the country needed to gain greater self-sufficiency (agriculture and industrial production)

  26. Industrial co-management • Chavez government has allowed some nationalized industries to be co-managed with workers • This experiment began with the main electricity company, CADAFE. • Continued with two private companies that the state nationalized after going bankrupt • State-owned aluminum company, in 2005

  27. Social Productive Enterprises • Social Productive Enterprises are firms that are meant to explicitly take into account social and communal concerns. • EPS program officially created in 2005

  28. Social Productive Enterprises • To qualify as an EPS a firm must “produce goods or services in which work has its own meaning, without social discrimination nor privileges associated with one’s position in a hierarchy, in which there is substantive equality between its members, planning is participatory, and they operate under state, collective, or mixed ownership”

  29. Social Productive Enterprises • Social Productive Enterprises receive benefits from the state, such as financing and privileges in state purchasing. • In 2005, 500 companies had been given EPS status.

  30. Need to Diversify Economy • The continued growth and revenues from the oil industry creates difficulties in developing other industries, or in agriculture • Consequently, Venezuela remains an net importer in almost all other sectors

  31. “Internalizing” Oil Production • Develop industrialization of oil production, to produce oil related products, rather than just crude oil • Create “spin-off” industries that would lead to industrialization in other sectors

  32. Currency Controls • Volatility in the currency markets between 1984 and 2002 • Bolivar was allowed to float in 2002 • Oil Shutdown in from December 2002 February 2003 caused currency to plummet

  33. Currency Control • To control Capital Flight, Chavez imposed strict Currency Control in 2003 • To have access to dollars, businesses had to prove need for imports • Beneficial consequences: Venezuelans forced to find domestic investment opportunities • Stock Market boomed between 2003 and 2005

  34. A Path Towards 21 Century Socialism? • Chavez on possible definitions of 21 century socialism: • “There is no solution within capitalism. Nor is it about statism or state capitalism, which would be the same perversion of the Soviet Union. We must reclaim socialism… Humanism, putting humanism and not the machine ahead of everything, the human and not the state.” World Social Forum, 2005

  35. 21 Century Socialism as Political • “Socialism of the political: this has a combination of elements, but one is central: participatory and protagonist democracy. This is the central axis of socialism in the political [realm], democracy from below, from inside, full democracy…” Chavez, 2005

  36. 21 Century Socialism as collective, cooperative, and communal • Socialism is “…increasing cooperativism, collectivism, collective property, the submission of private property to the social interest and to the general interest.” • It is a “communal system of production and consumption”