Monday, July 17, 2006

A HISTORY OF VENEZUELA III

In fact, the central government is weak, and it has to allow federalism, which favors the countryside. The constitutions of this time are a combination of centralism and federalism to try to reconcile the different sectors. The cities want a centralized government, while the landowners want federalism. The lack of communication favors the ruling class in the country, who is more interested in its region that in the nation itself. This isolation presents an obstacle to a national market, which is favored by the rising bourgeoisie and foreign economic interests. These conflicts lead to a series of wars.
The ruling class in the countryside, who has come to power as a result of the independence struggle by taking over Spanish land holdings, needs the popular sectors from whom they extract loyalty by various means. Thus the figure of the Caudillo Nacional Autocrático appears as a model of national unity for the next several decades. The autonomous attitudes of the provinces give origin to rivalry between leaders, so that one is supreme at one time only to be thrown out and replaced by another at a later date, and so on. Under these conditions the political process can only be resolved through civil wars.

1898. Andrade. Cipriano Castro.
The border dispute with English Guyana is submitted to arbitration in Paris. Venezuela loses more than 100,000 square km of its territory as a result.
Cipriano Castro uses as his slogan "New men, new ideals, new procedures." He attempts to unify all the warring factions in the government. He asks the bankers for loan in order to pay huge debts that have been incurred, and when the bankers refuse he puts them in jail. The bankers relent, but at the cost of becoming Castro’s enemies to the point of supporting armed uprising against him. Some other companies that are affected are: New York & Bermúdez company, which has the monopoly on asphalt, the Orinoco steamship Co. which controls navigation on the river, a German company that controls railroads, and a French company that controls communications. All of them engage in intrigues against the government, but Castro is able to defeat all these uprisings. Warships from Germany, France, Italy , Holland and the US begin to appear off the coast of Venezuela. Castro meets them with six thousand men at La Victoria and defeats their armies after 22 days. One of his lieutenants, Juan Vicente Gómez, bides his time until he can take over the government and institute one of the bloodiest dictatorships in the history of the country.
1900- The external debt is 190 million bolívares, to which are added countless claims from foreign companies, some of them ridiculous and exaggerated, that total 160 million additional bolívares. This is also the beginning of US imperialism in Latin America. William McKinley declares: the Monroe doctrine has not been founded to defend the American republics in their evil deeds nor in their violations of international rights. His successor Theodore Roosevelt proclaimes "speak softly but carry a big stick," referring to the countries south of the US border. It was at this time the United States takes over the building of the Panamá Canal.
A wave of indignation at European encroachment sweeps over the Venezuelan people. The German and English embassies are stoned, their flags are burned. Castro frees political prisoners and jails those who support Germany and England. Volunteers are formed to fight against the aggressors. Castro issues the rallying cry; "The insolent foot of the foreigner has profaned the sacred soil of the motherland." The aggressors bomb and land at Puerto Cabello and loot the place. Eventually they are repulsed. Public opinion in the United States, Germany, France, and England denounces the aggression.
Germany and England demand immediate payment of the debt, a debt that has been imposed by force, and which is of little interest to the European powers but rather a means of permanently taking over Venezuelan territory.
Castro modernizes the Army, and this is the decisive factor in maintaining control of the government. Castro becomes enthroned in the seat of power. The price the Venezuelan people pay for unity and the repulsion all foreign aggression is a tyrannical, dissolute and decadent government.
1908. Castro becomes ill, and goes to Europe for treatment. Gómez takes advantage of this situation and usurps power, becoming president for 27 years until 1935, when he dies at the age of 78. The Gómez government is marked by greed and illicit enrichment of all his friends that has never before seen in the country. Gómez becomes the largest landowner of all, much of it fallow land. He controls 60% of the cattle industry. Gaming is legalized and becomes the property of the Gómez family. He takes control of river and coastal navigation, electric companies of various cities, the sugar refineries, coffee and cacao plantations, small industries of clothing, soap, cigarettes, candles, oils, hotels etc.
1911 - Gómez modernizes the military school of Caracas,
making the military a professional career. Cadets, however, in conjunction with intellectuals and students, began to conspire against the dictator.
1914- With a First World War there is a new factor in the Venezuelan economy: petroleum, which is to play a decisive role in the prosperity of the Gómez regime. Gómez returns the concessions to the New York & Bermúdez company and allows for oil exploration in the eastern part of the country.
1920 --- Gómez creates a school of military aviation and buys planes from France and Germany for the purpose. He builds roads to make way for automobile traffic. These have the effect of mobilizing the Army into the interior.
1926 --- Petroleum exports rise from 100,000 bolívares in 1916 to more than 250 million. Gómez gives more and more concessions to the point where Venezuela is systematically sacked by foreign companies, among them British Caribbean Petroleum Co., Standard Oil and Gulf Oil. Venezuelan law is written by lawyers and CEOs of these companies for their own benefit. These companies have an incalculable influence on national life by means of bribes, donations, subsidies, commissions, salaries and other means of administrative corruption. Their clients are; the dictator himself, his ministers, state governors, customs administrators, and others. Racial discrimination appears once more, brought to Venezuela by the petroleum companies. Even Venezuelan women married to North Americans cannot live in the US compound.
1928- 200 protesting students are jailed, but this in turn unleashes a wave of protest and strikes during several days, and the dictatorship has to back off. Even so, the political drama of 27 years unfolds behind the silent walls of the jails, the long sentences, the torture of those who do not agree with the absolute power of Gómez.
Foreign companies begin by exploiting hydrocarbons, then branch out into iron extraction, agriculture, commerce and transportation until they absorb all aspects of the national economy, including social and political life.
Indirect investment is that which is only there to supply interests and dividends. Direct investment is that which transfers capital from one country to the other and installs companies that the investor is going to run. This creates the growing concentration of capital in bigger and bigger companies that absorb or displace smaller ones in the formation of monopolies, raising prices and profits.
Countries in Europe and the United States, with their technological advances, are forced to penetrate other countries and to compete with each other on the world market. In order to be successful, the corporations have to control the raw materials. This is how they gain control of nitrate in Chile, sugar in Cuba, bananas in Central America, and petroleum in México and Venezuela, where the United States gains supremacy over Europe. Petroleum becomes the most important and most lucrative economy in the world, especially after the First World War. The ruling class in Venezuela stands to gain from such largesse and the Gómez government welcomes them with open arms.
Judges and other functionaries are bought to support the foreign companies, who threaten or declare war on anyone who objects. Bethlehem Steel, Royal Dutch Shell and standard oil, owned by John D. Rockefeller, are the leading companies at this time.
All-important decisions are made outside the country.
On the positive side, Venezuelan workers are trained in the extraction of petroleum, peasants become salaried workers forming a national working class. Civil and military bureaucracy increased. This leads to the existence of two Venezuelas, one connected with petroleum (benefitting no more than 3% of the population), and the rest, who are condemned to their traditional backward existence, a backwardness that facilitates their exploitation. The new higher incomes increase the demand for goods. Basic goods are met by the national economy, but the new rich demand imported industrialized and luxury goods, creating further dependency and further benefitting the developed countries. The needs of the rich are not only met, but artificially created for their satisfaction.
Foreign investors in Venezuela justify open intervention to protect their interests. They bring all the material and equipment from abroad as well as all consumer items that their American workers need, thereby setting up enclaves in isolation from the rest of the population. Any Venezuelan who wants to use foreign technology has to pay high quotas for the patents. Their presence forces the rest of the economy to remain underdeveloped.
The Venezuelan economy becomes an assembly industry, that is, parts are imported for assembly inside the country. With one or two factories that produce more than the national market requires, the Corporation keeps part of the productive capacity of the companies idle, and allows for monopolies. This contributes to the high cost of living.
Capitalism grows without being able to absorb all the workers, creating great unemployment and poverty. Foreign companies are forced to keep export duties low and import duties high, which further impoverishes the nation.
The world crisis of 1929 plunges prices to the very bottom ruining the landowners and the peasants who depend on them. The commercial class in Venezuela recovers by integrating itself to the world capitalist system. An educated artisan class is also impoverished and joins the working-class, bringing with it ideas of unionization and struggle.
The insertion of a foreign capitalist class into the social structure of the country becomes a solid political power in politics, supported by the local ruling class who stands to benefit by this.
The local business class is formed by some elements of the landowners and the political bureaucracy tied to imports, real estate, transportation and other local services. As the economy grows the lines between merchant, industrial, and finance capitalism are lost. There is parallel growth in class consciousness in the capacity to organize to defend its own interests. The working-class grows from 70,000 workers to 141,000 in eight years.
1925 -- In spite of the dictatorship there is a strike in Zulia state which wins an increase from five to seven bolívares a day.
1937 -- A group of exiled Venezuelans in México found the first Marxist party called the Revolutionary Venezuela Party (PRV).
1931 --- The first manifesto of the Communist Party of Venezuela is published. It promotes a revolutionary class-based ideology, and is against imperialist exploitation.
1935. López Contreras becomes president. During this time the people awake after many years of dictatorship and begin to participate more actively in politics. Gomecistas from the dictatorship are afraid they will lose their privileges. López Contreras breaks with them and forms a moderate government. He frees political prisoners and authorizes those who have been exiled to return. He allows freedom of the press, and demonstrations, while at the same time allowing the members of the dictatorship to leave and take their fortunes with them. At this time the struggle against the cuadillos is reduced to the struggle between political parties and the beginnings of a democratic system. In spite of the reforms, the government remains anti-communist and opposition members have to work underground. The government also objects to unions and peasant's leagues that begin to spring up around the country.
The president is elected only by the national assembly (Congress) while the population can only vote for local and national representatives if they are 21 years old and can read and write, in a country that is 75% illiterate. People begin to object to these measures and demonstrations are put down violently. Eventually the government allows members of the democratic opposition to enter the government.
1936 -- Working-class movements engage in battles against foreign companies, such as during the petroleum strike of the period. The collective contract establishes the 8- hour day and benefits, forcing the owners to build housing, schools, and hospitals for the workers. In spite of this, the petroleum companies turn over only a token percentage of their earnings, and the agreement is not honored in practice. Landowners continue to steadily encroach upon peasant lands.
The first working law is approved allowing for unions. A national strike is put down by López Contreras, defending the petroleum companies. The unionized working class continues to grow and reaches 1,789,429, numbering 60% of the working population. Domestic servants, public administrators, other professionals, students and small property owners all continue to grow in numbers. In spite of this, 50 per cent of the urban population is in the informal sector, unemployed, all with the lowest-paying temporary jobs. Delinquency rises. Foreign workers crowd the cities.
The national Democratic Party is formed, bringing together different left groups. López Contreras attempts to create greater unity among the Latin American countries.
1941 --- Angarita becomes president. He breaks with the Axis powers, declaring that both petroleum and the war serve to help Venezuela obtain better contracts with foreign companies. Venezuela establishes diplomatic relations with the Soviet Union.
Angarita legalizes the Accion Democratica party, which becomes the opposition party. Thanks to a constitutional reform, communists are allowed to become active in the Popular Union.
1943 — The petroleum reform. Angarita declares that the petroleum refineries should belong to the Venezuelan people and serve as a source of work for Venezuelans. Foreign companies have been taking the super profits out of the country and are only interested in continuing production in the fight against fascism. The reform charges them import taxes and eliminates the exorbitant customs duties and tariffs that are charged to Venezuela. This results in a substantial increase for the public treasury.
1945 --- Militaries y civilians. The political system that has been in place for 100 years is that the representatives nominate senators, following orders from the executive. Municipalities designate congresspersons. Senators and representatives in the congress in turn name the president of the Republic.
Now, political parties start to agitate for direct, universaland secret national elections, something that has been done only in local elections up to now. A constitutional reform is proposed. Angarita rejects the proposal, with the result that he is overthrown by a military coup, which promises to bring about general elections. Four parties run candidates; Acción Democrá
tica, the Communist Party ,COPEI, and the URD. The overwhelming winner is Acción Democrática. with Rómulo Gallegos at the head.
1946. Rómulo Gallegos is the first president to be elected through direct universal suffrage. His regime only lastes nine months. He is overthrown by another military coup.
1948 — The Pérez Jimenez dictatorship. The military junta outlaws all left parties. Efforts are made at this time to unify all national social classes to overthrow the dictatorship. FEDECAMARAS, the main capitalist organization, plunges into neo-liberalism, defending the freedom of corporations, the need to restrict the national governments in economic life, the need to cooperate with foreign capital. They feel that this will guarantee the development of the country led by the corporate class. On the other hand, there is a strong underground protest movement inspired by the Cuban revolution. Two new parties gain power, COPEI (social Christians, who believe society is for the individual), and Acción Democrática (social Democrats, who try to reconcile differences by bringing together all the popular classes). A third-party, Marxist, is primarily interested in overthrowing imperialism.
The government makes other political parties illegal, censors the press, persecutes politicians, suspends constitutional guarantees , closes the universities etc.
1950. The URD wins the elections that the military junta refuses to recognize them. The URD leaders are expelled from the country. The military junta turns power over to Pérez Jiménez, who initiates construction of grandiose works, using funds from a corrupt administration and raiding the public treasury. The Pérez Jiménez dictatorship seeks the support of theforeign industrial bourgeoisie that benefits from juicy contracts in the construction of these public works. He sells off the oilfields to the highest bidder, to the point where Eisenhower presents him with the Legion of Merit. He is instrumental in the planning and execution of the overthrow of the Arbenz government in Guatemala. Eventually his government becomes bankrupt and the military, the communist party and the URD start plotting against him.
1952 — Pérez Jiménez continues race relations with the Soviet Union and with Cuba, while encouraging OPEC. The Andean pact promotes greater culture and commerce between South American countries, collaborating with underdeveloped countries and negotiating with developed ones.

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