Posted July 29, 2016

     There were numerous impediments to the Third World project that was proposed from 1948 to 1979 and defended by Fidel and Cuba from 1979 to 1982.  

     The declining terms of trade continued to be manifest during the 1980s.  The Third World strategy of forming public primary product cartels (“The Third World Project, 1948-79” 7/20/2016) was not able to reverse the process.  The necessary cooperation among producing nations could not be attained with respect to many raw materials, for various economic, technical and political reasons.  Even in the case of the oil industry, the formation of OPEC and the nationalization of oil companies had limited results, for they did not overturn the overwhelming power of the seven largest oil transnationals (Prashad 2007:186-89, 227-28).

     In addition, South-South cooperation required the development of a transportation infrastructure and new investments in appropriate industries.  It was difficult to implement, in light of the limited capital of the Third World and the continuing opposition of the core powers, who correctly saw South-South cooperation as a threat to the structures of neocolonial domination (Castro 1983:177).

      But it was above all the external debt that killed Third World hopes.  In 1960, the total debt of 133 underdeveloped countries was US$18 billion.  By 1970, it had risen to $75 billion; and by 1982, it had risen to $612 billion (Prashad 2007:229).  The escalating debt was driven by the desire of Northern commercial banks to lend.  With excess liquidity due to the high levels of deposits from the OPEC countries that resulted from the oil price hike, and with loans to Third World countries being more profitable than investment in production, representatives of Northern banks traveled to the nations of the Third World during the 1970s with low interest loan offers, but with variable rates of interest. The funds were not destined to projects that could improve the productive capacity of the receiving nation, thus ensuring its ability to repay the loans; rather, they were emergency funds that represented a short-term solution to declining government revenues due to the declining terms of trade and high rates of inflation.  During 1979-80, the interest rates were elevated, making their repayment impossible. The impact of the elevated interest rates was such that from 1982 to 2003, the payments of underdeveloped countries in service of the debt was twice the amount of money that had actually been lent.  In 2002, debt service payments by Third World countries were five times what they received in “aid” (Hernández 2006:82-86; Millet and Toussaint 2004).

     At the 1983 New Delhi Summit of the Non-Aligned Movement (“Derailing the Third World project” 7/22/2016), Fidel led the radicals in putting forth the proposal that the Third World states suspend their payments on the external debt.  He maintained that a debt payment strike would constitute a collective action strategy that would strengthen the bargaining position of the Third World governments. Fidel continued to speak on the Third World debt and the need for a strike of debtor nations.  In a number of speeches in Havana in 1985, at the 1986 Summit of the Non-Aligned Movement in Zimbabwe, and at a 1987 ministerial meeting of the G-77, Fidel maintained that payment of the debt: is financially impossible, as interest rates escalate the balances; would be politically impossible to impose, as the consequent reduction of necessary human services would lead to widespread popular revolt; and cannot be justified morally, as it imposes the greatest sacrifice on the poorest, who are the least responsible for it (Castro 1989).  But the accommodationists of the Non-Aligned Movement argued against Fidel’s proposal for a strike of debtor nations; they advocated that each nation should individually negotiate a restructuring of debt payments.  The accommodationists prevailed (Prashad 2007:214).

     The negotiation of debt payment restructuring by individual nations did not have positive results for the Third World.  The US Treasury Department and the IMF established conditions for the rescheduling of debt payments.   The IMF negotiations prevented the Third World governments from defaulting, and they also prevented the Northern commercial banks from failing.  However, the debt rescheduling plans resulted in a continuing escalation of the total debt.  Moreover, the imposition of economic policies by the IMF as a condition for debt rescheduling undermined of the sovereignty of Third World states (Hernández 2006:91-92; Prashad 2007:222, 229-32, 239).

      The conditions established by the IMF were in accordance with what came to be called “Structural Adjustment Policy,” which was exactly the opposite of what Fidel and the Third World were proposing. Structural adjustment policy demanded: (1) the elimination of government protection of currency, thus devaluating national currencies; (2) the elimination of government protection of national industry, thus undermining the import-substitution development project that was the plan of many Third World nations; (3) the facilitation of an export-oriented economy, thus expanding the access of core corporations to Third World raw materials, cheap labor, and markets; (4) reduction of the role of the state in the economy, thereby reducing restrictions on foreign participation in the economy; and (5) the selling of state-owned economic enterprises to private companies, thus increasing foreign ownership.  The Structural Adjustment Policy was based on the premise that the state should abdicate its role in the formulation of a national development project and the management of the economy, and it should leave everything to the market (Prashad 2007:232-33, 236).

     The IMF justified the Structural Adjustment Policy with an ideological attack on the state.  It maintained that that the central problem was the over-involvement of the state in the economy as well as state corruption and inefficiency.  It thus blamed the Third World state for persistent Third World underdevelopment and poverty, as though neocolonialism and imperialism existed only in the minds of a few Leftist intellectuals (Prashad 2007: 233, 236).

      The neoliberal view of the primacy of the market in promoting economic development overlooks fundamental historical facts.  Throughout history, states have played an integral role in commercial and technological development and in the emergence of civilizations.  In the modern era, the colonial, neocolonial and imperialist policies of powerful states have played a central role in the economic development of some regions and in the underdevelopment and impoverishment of other regions.  The neoliberal project, in ignoring the Third World proposal for a New International Economic Order, was violating an epistemological premise that is a legacy of Marx, namely, that philosophical, historical and social scientific understanding is advanced by taking the vantage point from below of the exploited classes and dominated nations.  Promoted by individuals and centers associated with the most prestigious universities of the world, the neoliberal project was not based on a quest for understanding the true and doing the right, but in promoting the interests of Northern banks, transnational corporations and core countries.  Neoliberalism represented the triumph of particular interests over the common good and of ideological justification over truth, demonstrating a profound indifference to the tremendous thirst of humanity for social justice.  It was a project of domination carried out not by soldiers or mercenaries conscripted from the lower classes and oppressed nations, but by an educated and privileged class dressed in expensive business suits, who became the conquistadores of our time.

      In imposing the neoliberal project, the International Monetary Fund violated a fundamental right embraced by various documents of the United Nations: the right of the sovereignty of nations, which necessarily includes the right of each nation to formulate a national development plan and to define the role of its state in its economy. The International Monetary Fund assassinated the Third World national liberation state, the embodiment of the hopes of the formerly colonized peoples of the earth.  

     But the Third World would rise again, as we will see in subsequent posts in this series on the Third World project.  The Third World would recover its revolutionary faith and its spirit of struggle, invoking such words as: “A better world is possible;” “No to neoliberalism;” “The dignified example of Cuba;” “Fidel: the comandante of all excluded peoples;” and “Socialism for the twenty-first century.”  Hugo Chávez would exalt: “We are making real the dreams of Bolívar and Martí;” “We again are singing The International in the streets of our America.”

​References
 
Castro, Fidel.  1983.  La crisis económica y social del mundo.  La Habana: Oficina de Publicaciones del Consejo de Estado.
 
__________.  1989.  Fidel Castro y la Deuda Externa.  La Habana: Editora Política.
 
Hernández Pedraza, Gladys.  2006.  “Evolución de la Deuda Externa del Tercer Mundo,” in Libre Comercio y subdesarrollo.  La Habana: Editorial de Ciencias Sociales.
 
Millet, Damien, and Eric Toussaint.  2004.  Who owes who?  50 questions about world debt.  Translated by Vicki Biarlt Manus with the collaboration of Gabrielle Roche.  NY:  Zed Books
 
Prashad, Vijay.  2007.  The Darker Nations: A People’s History of the Third World.  New York: The New Press.
 
 
Key words: Neoliberalism, structural adjustment policy, SAP, International Monetary Fund, IMF, Non-Aligned Movement, Third World
 

Posted August 1, 2016

     The Structural Adjustment Policy of the International Monetary Fund was developed in response to the structural crisis of the capitalist world-economy, and it was defined by defense of the interests of the upper class, the transnational corporations, and the powerful nations, resulting in negative consequences for the poor nations and the lower classes (see “USA & IMF attack the Third World project” 7/29/2016).

      Exempt from the maneuvers of the International Monetary Fund by virtue of its revolutionary commitment to true independence, Cuba nonetheless would confront in the 1990s the need for its own structural adjustment plan.  The collapse of the Soviet Union and the socialist bloc had created an economic crisis in Cuba, inasmuch as socialist Cuba had developed extensive commercial relations with the socialist world.  The impact of the economic crisis on Cuba was much greater than the global impact of the simultaneous world-system crisis, since Cuba’s principal trading partners had disappeared; and Cuba remained ineligible for credits and loans through international finance agencies, as a consequence of the US blockade.  In three years, the Gross Domestic Product was reduced by 23%, due principally to the impossibility of importing capital goods and raw materials.  The purchasing capacity of the country was reduced from 8 billion dollars to 1.7 billion dollars.  The supply of petroleum declined from 13.4 million tons to 3.3 million tons, while national production of petroleum fell 17.8%.  As a result, electric energy was reduced to 70% of its 1989 level, and steel production was at 19% of its 1989 level.  The sugar cane harvest declined from 7 to 4.3 million tons, and agricultural production and animal husbandry declined by 53%.  As a result, consumption declined dramatically, and the people began to live under conditions of extreme scarcity.  A good part of the day was spent without electricity.  The system of public transportation was drastically reduced, and many people walked or rode bicycles (Arboleya 2008:199-201).  

     The Cuban plan of structural adjustment plan was formulated by Fidel, now in his sixties, who continued to be everywhere present as the leader of the Cuban revolutionary project.  The Cuban adjustment plan demonstrated once again the exemplary character of the Cuban Revolution and its historic leader, for it showed how to adjust to economic crisis in a form that gives priority to the needs of the people.

     The Cuban adjustment policies were in important ways different from the structural adjustment policies adopted in Latin America during the same time period (López 1994).  First, the Latin American structural adjustment was being imposed by international finance agencies, such as the International Monetary Fund and the World Bank, as a condition for restructuring debts, whereas the Cuban adjustment policies emerged from the Cuban national political process in response to the new international economic and political situation. Cuba had to adjust to new international realities, but it was Cuba herself who was deciding what to do in the new situation; policies were not being imposed by outside agencies.  Secondly, whereas the Latin American structural adjustment policies were designed to increase corporate profits in an era of stagnating profits and markets, without regard for the social consequences of the measures; the Cuban adjustment was designed to protect the standard of living of the Cuban masses and to preserve the social and economic gains of the Cuban Revolution, giving priority to the maintenance of the system of health, education and social security.  Thirdly, unlike the Latin American structural adjustment, the Cuban adjustment policies were developed in a context of wide citizen participation.  There was a “popular consultation” in regard to the measures during 1993 and 1994, involving the mass organizations of workers, peasants, students, , and women as well as neighborhood organizations.  The popular consultation gave the people an opportunity to make recommendations, many of which were implemented, as well as to gain a greater understanding of the international and national economic situation and of the necessity for the measures.  

     The Cuban adjustment plan was oriented toward the diversification of trading and commercial relations, and on the expansion of production in industries with higher wage rates than the classical peripheral exports, such as sugar.  Accordingly, Cuba sought to expand investments in certain branches, such as tourism (with foreign and Cuban state capital), the pharmaceutical industry and biotechnology (with Cuban state capital), petroleum (with foreign and Cuban state capital), and nickel (with foreign and Cuban state capital). This expansion included efforts to attract foreign capital, but under conditions of strong regulation by the Cuban government, fundamentally distinct from the privatization of companies and the opening to foreign capital that was occurring throughout the world with the imposition of the neoliberal project.  For example, most agreements with foreign hotel companies are joint ventures with the Cuban state, and the foreign firm does not employ the Cuban workers directly.  Cuba attracts foreign investment not by selling natural or human resources cheaply, but by providing an educated workforce, political stability and an opportunity for reasonable profitable investment.  

     Various measures were adopted to improve productive efficiency, including: the decentralization of government-owned enterprises, with many state companies expected to become fully or partially self-financing; the conversion of state enterprises in agricultural production and animal husbandry into cooperatives, along with an expansion of the sale of agricultural products under market conditions; and a significant expansion in the possibilities for self-employment.  In addition, a plan for the rationing of electricity and gasoline was implemented.

     Cuban adjustment policies adopted during what Cuba calls the “Special Period” enabled the country to emerge from the depths of the crisis in 1993 to a level of recovery by 2001.  Beginning in 1994, there was a steady growth in the gross domestic product.  Hamilton observes:  “The net economic effect of the changes introduced during the Special Period was positive.  The economy was saved from collapse and after 1995 began to show significant rates of growth—0.7 percent, 2.5 percent, and 7.8 percent in 1994, 1995, and 1996, respectively, compared with an average annual rate of growth of 4.3 percent from 1959 to 1989 and a 3.5 percent average for Latin America and the Caribbean in the mid-1990s.  Expansion has continued, with growth in GDP of 2.5 percent in 1997, 1.2 percent in 1998, and 6.2 percent in 1999” (2002:24).  The recovery largely was stimulated by growth in tourism, biotechnology, and mining.  

     Tourism has become the principal industry of the country.  During the 1990s, it grew at a rate of 18% per year, increasing from 340,000 tourists in 1989 to 1,774,000 in 2000, reaching 2 million tourists annually in 2007.  The hotel capacity on the island increased threefold from 1989 to 2007 (Arboleya 2008:204).  Hotel capacity continues to expand, supplemented by the incorporation of private rental rooms. The number of annual tourists in Cuba now surpasses three million.

     During the Special Period, there were significant investments in the biopharmaceutical industry, with the intention of developing high-technology exports that commands high prices in the world economy, as Fidel had proposed in the debates in the Non-Aligned Movement in the early 1980s.  Cuban scientific research centers have developed fifty products and services that have received international patents, including a Hepatitis B vaccine.  These centers have begun to sell these products and services in the international market, although there are obstacles due to the US blockade as well as monopolization of the market by the large pharmaceutical corporations (Arboleya 2008:205).

    Petroleum production increased six fold from 1991 to 2001, and Cuba now produces enough petroleum to be self-sufficient in the generation of electricity (Arboleya 2008:205).  Joint ventures in the nickel industry brought its production to a record level by 2001.  Cuba is the sixth largest producer of nickel in the world, and it has the largest nickel reserves in the world (Arboleya 2008:205).

     During the Special Period, the system of health and education developed prior to 1989 was in essence preserved (Arboleya 2008:206).  After 1998, Cuba began to expand its international medical missions in the countries of the Third World, and in 2001, there began a project to reconstruct school buildings and reduce class sizes as well as the development of municipal universities in a project for the “universalization of education.”   

    As a result of the willingness to sacrifice on the part of the Cuban people, the Cuban Revolution survived.  There has been some degree of erosion of socialist values as a result of the dynamics of the Special Period, but the popular commitment to the Cuban revolutionary process remains strong, and the Cuban political process continues to be characterized by extremely high levels of mass participation and legitimacy.  As Arboleya writes:  “Few imagined [in 1994] that Cuba would be capable of overcoming this crisis.  Even a good part of the international Left predicted the anticipated internment of the Cuban Revolution. . . .  The overcoming of the crisis to the present level constitutes a fact explainable only on the basis of the cohesion created by the Revolution and the virtues of the socialist distributive system. There were great shortages, but not starvation; unemployment, but not alienation; there were tensions, but not uprisings, much less generalized repression, as would have been normal in the rest of the world.  In the worst moments, the health system was maintained and the schools continued functioning with used books, paper, and pencils” (Arboleya 2008:201-2, 206). 

     Arboleya maintains the Cuban Revolution today possesses legitimacy and popular support as a consequence of the fidelity of the revolution to the interests of the popular classes that are its social base, and as a result of its defense of the sovereignty of the nation, consistent with the nationalism and anti-imperialism that have been central to the Cuban Revolution since the days of José Martí.  And the popular support of the Cuban Revolution has given it legitimacy before international public opinion (2008:209-10).

     The Cuban structural adjustment plan stands in sharp contrast to that imposed by the International Monetary Fund and the global powers.  On the one hand, the Cuban plan is more moral, for it is based on the universal human values proclaimed by humanity, such as the rights of nations to sovereignty, and the rights of all citizens to education, health care, and meaningful political participation.  But the Cuban structural adjustment policy is also more politically intelligent and economically effective: Cuba is recovering, but the world-system falls deeper into crisis, each day increasingly demonstrating its unsustainability.

     The Cuban adjustments during the 1990s is yet one more example of the exceptional capacities of the historic leader of the Cuban Revolution, who will soon celebrate the ninetieth anniversary of his birth, an event which is widely anticipated in Cuba and Latin America.

References
 
Arboleya, Jesús.  2008.  La Revolución del Otro Mundo: Un análisis histórico de la Revolución Cubana.  La Habana: Editorial de Ciencias Sociales.
 
Hamilton, Douglas.  2002.  “Whither Cuban Socialism? The Changing Political Economy of the Cuban Revolution,” Latin American Perspectives (Issue 124, Vol.29 No.3, May, Pp. 18-39).
 
López, Delia Luisa.  1994.  “Crisis Económica, Ajustes y Democracia en Cuba,” FLACSO Documentos de Trabajo III

​ 
Key words: Cuba, Special Period, Structural Adjustment Policy (SAP)

​

Posted August 2, 2016
​
     In 1994, there were two significant events.  First, there was the Zapatista uprising in Chiapas, Mexico, which marked the first internationally-known protest of the neoliberal project of the global powers.  Secondly, Hugo Chávez, a military officer who had led a failed coup d’état in 1992, was released from prison in response to popular demand.  The goal of the coup had been to take power and immediately convoke a constitutional assembly, in order that the Venezuelan peoples could develop a constitutional order more protective of the rights and needs of the people and the sovereignty of the nation. Upon his release from prison, Chávez continued to work for a new constitution, and to this end, he established the Bolivarian Fifth Republic Movement.  Chávez would become President of Venezuela and would lead the nation and the region of Latin America and the Caribbean toward the overthrowing of the neoliberal project.

     Accordingly, the year 1994 marks the beginning of the renewal of the Third World project, during which the peoples and nations of the Third World retook the radical Third World agenda that had been formulated by the charismatic leaders, social movements and revolutions of the Third World during the period 1948 to 1979 (see “The Third World Project, 1948-79” 7/20/2016).  The renewal was born in rejection of the neoliberal project by the people, who experienced the negative consequences of neoliberal policies, such as: the devaluation of their currencies; increases in the costs of water, electricity, natural gas, and buses; reduction in government programs and services; the undermining of local agricultural production; and higher levels of unemployment, crime and violence.  Drawing upon decades of anti-colonial, anti-neocolonial and anti-imperialist movements, leaders emerged that were able to reformulate the concrete demands of the people with respect to specific grievances into a broader political and social critique of neoliberalism, imperialist policies, and the neocolonial world-system.  Thus there emerged a popular movement across Latin America, the Movement for an Alternative World, proclaiming that “A Better World is Possible.”

       The Alternative World Movement spawned new political parties that sought to take power away from the traditional political parties that had cooperated with the global powers and transnational corporations in the imposition of the neoliberal project.  The movement had such a wide following that the new popular parties were able to win presidential and/or parliamentary elections in the number of Latin American states, including Venezuela, Bolivia, Ecuador, Brazil, Argentina, Uruguay, Nicaragua, El Salvador, and Paraguay.  In addition, led by the Leftist and progressive states, Latin America and the Caribbean developed new regional organizations of economic, political and cultural cooperation, challenging US imperialist policies and seeking to develop alternatives to the structures of neocolonial domination.  The charismatic leaders of four of these nations (Venezuela, Bolivia, Ecuador and Nicaragua) proclaimed the process of change as one that sought to build “Socialism for the Twenty-First Century,” and leaders from throughout the region proclaimed their admiration for Cuba as a “model of Latin American dignity.”  

      The new political reality in Latin America affected the Third World as a whole, as can be seen in the dynamics of the G-77 and the Non-Aligned Movement as well as in the emergence of BRICS, an international organization formed by Brazil, Russia, India, China and South Africa.  The nations of BRICS have been deepening relations with Latin America and its progressive governments, thereby seeking to sidestep the structures of the neocolonial world-system dominated by the Western powers.

      Since 1994, then, there has occurred a renewal of the Third World project and a retaking of the radical Third World agenda of the period 1948 to 1979.  The following fourteen posts in the series of twenty-three posts on the Third World project will be devoted to the post-1994 renewal of the Third World project, according to the following plan:
“The neocolonial era in Venezuela;”
“Hugo Chávez Frías;
“The Bolivarian Republic of Venezuela;”
“The Chávist presidency of Nicolás Maduro;
“The Movement toward Socialism in Bolivia;”
“The Citizen Revolution in Ecuador;”
“The Sandinista Revolution in Nicaragua;”
“Latin America and Caribbean unity;” 
“The renewal of South-South cooperation;” 
“The spirit of Bandung lives;”
“The new counterrevolution of the Right;”
“The subtle Eurocentrism of the Left;”
“Beyond Eurocentrism;” and
“The possible and necessary popular coalition.”

​
Key words:  Third World, neoliberalism, Alternative World Movement

Posted August 3, 2016

     World-system structures, forged by the European colonial powers from the sixteenth through the nineteenth centuries, are characterized by the exportation of raw materials from peripheral zones, on a base of forced and low-waged labor; and by the exportation from the core of industrial manufactured goods.  In reaction to the underdevelopment and poverty that resulted from world-system structures, anti-colonial popular movements emerged in the peripheralized regions, and they were able to forge independent states.  But the newly independent nations confronted various economic and political obstacles to the transformation of the core-peripheral relation (see various posts on the origin and development of the world-system; see also posts in the category neocolonialism).      
 
     In Latin America, independent republics were established during the period 1810 to 1825, but during the period 1850 to 1900, British and US control of commerce facilitated semi-colonialism.  During the twentieth century, US imperialist policies made possible a more complete commercial, financial and ideological penetration of Latin America, creating a more developed system of neocolonialism under US hegemony.  During this entire period of semi-colonialism and neocolonialism, raw materials flowed from the region, as they had during the period of Spanish and Portuguese colonialism (see various posts on the Latin American history as well as “The characteristics of neocolonialism” 9/16/2013).

     In the case of Venezuela, petroleum surged as the principal raw material export during the period of 1917 to 1960.  The petroleum companies were foreign owned and largely unregulated.  As the result, the Venezuelan state received little income from petroleum, and the benefits to the economy and the people of Venezuela were minimal. During the period, a popular movement emerged to demand greater national control of the petroleum industry.  After 1960, this became the prominent popular demand, such that the period of the 1960s and 1970s is known as the era of petroleum nationalism, in which the people were demanding that the state maximize its income from the exportation of petroleum.  During the period, the management of the companies became increasingly Venezuelan, as the foreign companies sought to respond to the demands of the popular movement and ensure political stability.  A gradual and cooperative transition to Venezuelan state ownership was unfolding.  

     Petroleum nationalism culminated in the nationalization of the petroleum industry and the formation of a state-owned petroleum company (Petróleos de Venezuela, Sociedad Anónima, or PDVSA) in 1976.  Inasmuch as the companies were under Venezuelan management by 1976, the nationalization changed ownership from international petroleum companies to the Venezuelan state, but it did not change the management of the companies in Venezuela.  And inasmuch as the Venezuelans that managed the companies had been socialized into the norms and values of the international petroleum companies and had internalized the perspective of international capital, the 1976 nationalization of the companies had little effect on their behavior.  PDVSA adapted itself to the neocolonial world-system, exploiting petroleum in accordance with the norms and interests of the international petroleum industry, rather than utilizing the petroleum industry as an integral part of a development plan for the nation.

     After nationalization, the Venezuelan state relaxed its oversight of the petroleum companies, believing that the industry was now under national control.   However, this was not really the case, as Venezuelan managers were directing PDVSA from the perspective of the international petroleum companies.  By creating a false impression of national control of the industry, nationalization had the consequence of creating more autonomy for the petroleum industry.  

      Like the foreign owned oil companies in other neocolonized countries, PDVSA sought to reduce payments to the Venezuelan state. Accordingly, PDVSA adopted a strategy of channeling surpluses to investments in production and sales, thus minimizing profits and corresponding payments to the state.  

     In the 1980s, PDVSA internationalized its investments in production and sales.  It bought refineries and distributorships in other countries in order to transfer surpluses out of the country, thus avoiding payments to the Venezuelan state.  

     With the turn to neoliberalism in 1989, the government of Venezuela greatly reduced its regulation of foreign investment in all branches of commerce, industry and finances.   With respect to the oil industry, PDVSA was given responsibility for supervising the “opening” of the country to foreign investment.  Under PDVSA supervision, many international petroleum companies formed joined ventures, with terms highly favorable to the foreign companies, and without consideration of national development.

     PDVSA, therefore, had emerged as a state within the state, with significant autonomy and with limited control by the state.  It did not seek to develop the petroleum industry and to attract foreign investment in the industry in a form that was integrated with a project for national development.  

     During the 1990s, there began to emerge popular rejection of the neoliberal project, as a consequence of its negative consequence for the people.  This dynamic included a condemnation of the role of PDVSA and its failure to contribute to a national development project. In this scenario, there emerged the post important charismatic leader of the beginning of the twenty-first century, Hugo Rafael Chávez Frías, whom we will discuss in the next post.


Key words: petroleum, PDVSA, nationalization, Venezuela, neoliberalism
​

Posted August 4, 2016

     In the context of the popular rejection in Venezuela of the neoliberal project imposed by the global powers with the collaboration of Venezuelan political and economic elite, and in a situation of popular disgust with the failure of the nationalization of the petroleum industry to promote national economic development (see “The neocolonial era in Venezuela” 8/3/2016), Hugo Chávez emerged as a charismatic leader with the capacity to describe the global and national structures of domination in understandable terms, and who was able to optimistically project an alternative political reality.  He thus possessed the capacity to forge that consensual reflection and united action necessary for a social transformation in defense of popular interests and needs.  He emerged as the central leader in the forging of a new political reality in Venezuela and in Latin America. The emergence of charismatic leaders with exceptional gifts of understanding and political leadership is a normal tendency in revolutionary processes (see various posts in the category Charismatic Leaders).
  
     Hugo Rafael Chávez Frías was born in Sabaneta, a rural village of Venezuela, on July 28, 1954.  Chávez describes his family as a poor peasant family.  His father was a school teacher who earned his teaching diploma by studying part-time.  Although his mother and father lived nearby, he was principally reared by his grandmother, a peasant woman who was half indigenous.  He describes himself as a mixture of indigenous, African, and European (Guevara 2005:14-15, 71-72, 76).

     In 1971, at the age of 17, Chávez entered the Military Academy of Venezuela, and he earned a commission as a Second Lieutenant in 1975.  His study during his years in the military academy established the foundation for his revolutionary formation.  He read the writings of Simón Bolívar, Mao Zedong and Che Guevara, and he developed a perspective that he describes as a synthesis of Bolivarianism and Maoism.  He investigated these themes further in a master´s program in political science at Simón Bolívar University.  He continuously read books of historical, political, social, and literary significance during his military and political careers, and he advised young people to develop the habit of reading.  He frequently recommended particular books in his discourses, famously exemplified by his recommendation of Noam Chomsky’s Hegemony or Survival during an address to the UN General Assembly and his gift to President Barack Obama of Eduardo Galeano’s Open Veins of Latin America (Guevara 2005:78-79; Chávez 2006:104).

    During the 1970s and 1980s, he had considerable success leading young officers in the forming of a reform movement within the military. On February 4, 1992, with the participation of approximately 100 fellow officers, he directed an attempted coup d´état, with the intention of overthrowing the government and convening a constitutional assembly. The coup failed, and he was imprisoned.  Upon his release in 1994, he resigned from the military and formed the Bolivarian Fifth Republic Movement, again with the intention of convening a constituent assembly, but now seeking to attain power through the electoral process.  He was elected President of Venezuela in 1998, in spite of the ignoring of his candidacy by the mass media, and he assumed the presidency on February 2, 1999.  He immediately issued a decree calling for a constitutional assembly.  Elections for a new constitution were held, and a new constitution was approved, establishing the Fifth Republic.  In 2000, he was elected to a six-year term as president under the new constitution, and he was subsequently re-elected, with nearly 63% of the vote, to a second term from 2007 to 2013.  He died of cancer in 2013 (Guevara 2005:9-39).

     Hugo Chávez understood that the underdevelopment of the peoples of Latin America, Africa, and Asia is a consequence of colonial domination.  Citing Andre Gunder Frank, he asserts: “Underdevelopment is a characteristic of development.  Our underdevelopment is a consequence of the development of the imperialist countries.  They only arrived at the level of development that they have after having invaded and sacked immense territories of Africa, Asia, and Latin America.  If not, they would not be at the level of development that they are” (Chávez 2006:132). 

     Chávez understood the negative effects of neoliberalism, which he condemned in moral terms.

     He castigated the subservient behavior of Latin American elites before US imperialist intentions:

​    Chávez believed that US imperialist policies are a threat to the survival of the human species, and that the peoples in movement must prevent this from happening.

    In contrast to US imperialism and US imposed neoliberalism, Chávez promoted a concept of autonomous economic development that he described as “a model of endogenous development that is not imposed on us by anyone, neither the Creole elite nor the imperialist elite, our own economic development” (Chávez 2006:319).  This model seeks to develop national production, giving emphasis to the development of energy, agriculture, and basic industry, and providing support for small and medium producers.  Endogenous development is rooted in the cultures and traditions of the peoples, particularly the indigenous peoples, and it has to be developed with a consciousness of history.  The study of history often has been only partially developed in the educational systems of neocolonial republics, and historical consciousness also has been undermined by the ideologies of the empire.  Chávez maintained that history must be rediscovered.

     Chávez believed that humanity stands at a critical time in world history.  “The capitalist model, the developmentalist model, the consumerist model, which the North has imposed on the world, is putting an end to the planet Earth.”  We can observe such phenomena as global warming, the opening of the ozone layer, an increasing intensity of hurricanes, the melting of the ice caps, and the rising of the seas.  Moreover, in the social sphere, rather than accepting their superexploitation and social exclusion, the peoples of the world are increasingly in rebellion.  Humanity is approaching a critical point, in which “in the first five decades of the twenty-first century it will be decided if in the future there will be life on this planet or if their will not be life.”  It is a question, he believed, of “socialism or barbarism,” citing Rosa Luxemburg (Chávez 2006:195, 256)

     At this critical and decisive moment in human history, Chávez possessed that hope in the future of humanity that is the hallmark of the revolutionary (see “The revolutionary faith of Fidel” 9/15/2014).  He believed that “the great day of liberty, equality, and justice is arriving.” This is exemplified, he believed, by the Bolivarian Revolution in Venezuela, which is constructing a “socialism of the twenty-first century” that will not be the same as the socialisms of the twentieth century.  It will be “a socialism renewed for the new era, for the twenty-first century. . . .  It will not have only one road; it will have many roads. It will not have one model; there will be many variants of socialism.  It will have to adapt to the circumstances of each country, of each region. . . .  Socialism for Latin America cannot be a replica, it has to be a great and heroic creation, a heroic construction of our peoples” (Chávez 2006:193, 198).

    Socialism of the twenty-first century is based on a renewed formulation of traditional values.  “Socialism of the twenty-first century ought to begin to consolidate new values that are not new, they are old values but one must renew them, one must strengthen them. . . . For us here in Venezuela, for example, and I believe that it is valid for a good part of Latin America and the Caribbean, Christianity is a current that pushes and feeds our socialism in construction.  This socialism of the twenty-first century has much of Christianity for the Venezuelans, as it has much of Bolivarianism and Marxism” (Chávez 2006:200).

     Chávez was an inspiring voice that resurrected the dream of national liberation formulated in the period 1948 to 1979 by charismatic leaders of the Third World and the Non-Aligned Movement (see “The Third World Project, 1948-79” 7/20/2016), calling the people to political action in the development of an alternative to the neoliberal project imposed by the global powers (see “IMF & USA attack the Third World project” 7/29/2016).  And in the tradition of Fidel, Ho Chi Minh, and Nyerere, he saw socialism as a necessary component of national liberation (“Fidel adapts Marxism-Leninism to Cuba” 9/9/2014; “Ho synthesizes socialism and nationalism” 5/8/2014).  In the next post, we will look at the Bolivarian Republic of Venezuela, forged under his leadership.

​References
 
Guevara, Aleida.  2005.  Chávez, Venezuela, and the New Latin America.  Melbourne: Ocean Press.
 
Chávez Frías, Hugo. 2006.  La Unidad Latinoamericana.  Melbourne: Ocean Sur. 
 
 
Key words: Chávez, Venezuela, socialism, Bolivarian Revolution

Posted August 5, 2016
​
     The central proposal of Chávez’s Bolivarian Fifth Republic Movement was the establishment of a constitutional assembly to bring to an end the Fourth Republic of Venezuela, which was adapted to neocolonial domination and to rule by a Venezuelan elite.  When Chávez assumed the presidency on February 2, 1999, one of his first acts was to sign a decree calling for a constitutional referendum.  The opposition sought to annul the decree through challenges to the Supreme Court, but the referendum was held, a Constitutional Assembly was elected, and a new Constitution was developed and approved.  Chávez terminated his presidency under the Fourth Republic after only two years and ran for president under the new Constitution.  In 2000, he was elected under the new Constitution to a six-year term from 2001 to 2007.  In 2006, he was elected (with nearly 63% of the vote) to a second term from 2007 to 2013.  He died of cancer in 2013.   

     The Chávez government sought to institutionalize the process of the popular participation that had been emerging during the 1980s and 1990s.  The government initiated the development of structures of Popular Power that include community councils, workers’ councils, student councils, and councils formed by small farmers, which are incorporated into confederations of local, regional, and national councils.  Chávez envisioned the gradual integration of popular councils into the state, “progressively transforming the bourgeois state into an alternative state, socialist and Bolivarian” (Chávez 2006:317, 325-27).  

     The government of Hugo Chávez sought to reduce the autonomy of PDVSA and to incorporate its resources into a project of national development.  The Chávez government appointed new directors of PDVSA, replacing the directors appointed by previous governments. With the new leadership of PDVSA, the state income from petroleum increased significantly, and the new funds were directed toward various social projects in education, health, and housing as well as to wage increases, financial assistance to those in need, and the elimination of foreign debt.  Most of the social projects are designated as “missions.” 

     A literacy program, Mission Robinson, was developed with Cuban support.  Named for Simón “Robinson” Rodríguez, who was Simón Bolívar’s teacher, it taught one million people to read in 2003. Other missions in education emerged:  Mission Ribas, named after independence hero José Felix Ribas, is a program for the completion of high school; Mission Sucre, named after Antonio José Sucre, one of the heroes of the Latin American revolution of 1810-24, is a scholarship program for university education; and Mission Vuelvan Caras provides opportunity for vocational training (Guevara 2005:50-54, 141).

      Mission Barrio Adentro is a medical mission that is financed by the Venezuelan state and relies upon the participation of 20,000 Cuban doctors, providing health care services in the poorest regions and neighborhoods of Venezuela.  In 2004, Mission Barrio Adentro attended 50 million cases, providing free health care services and medicine (Chávez 2006:110-11, 241-42).

    The government of Chávez played a leadership role in forging the unity and integration of Latin America and the Caribbean as well as South-South cooperation.  I will describe these processes, which retake the historic dream of the Third World, in subsequent posts in this series of posts on the Third World project.

     As a popular revolutionary project that seeks to attain the true sovereignty of the nation and to develop its own endogenous project of national development, the Chávist Bolivarian Revolution is a threat to the neocolonial world-system, which requires the subordination of the nations of the world to the Western neocolonial powers.  Since the emergence of the revolution, the US government has sought to undermine it through the support of those sectors in Venezuela that have interests in opposition to the revolutionary project, sectors that in one way or another benefit from the neocolonial world order.  These sectors include: the technocratic elite that managed the petroleum industry prior to 1998; the business elite, owners of import-export companies; leaders of the union of petroleum workers, who occupied a privileged position relative to the majority of workers; the landed estate bourgeoisie, historic beneficiaries of the core-peripheral relation; and the traditional political parties, junior partners in the imposition of neocolonial structures and in the implementation of neoliberal policies. These opposition sectors control the private media of communication, and they can count on international financial support and the active engagement of the US embassy. 

      During the period of the Chávez presidency from 1998 to 2013, the opposition generated much conflict, but the Chávist forces prevailed. However, with the death of Chávez in 2013, the opposition escalated its tactics, and they have created a complicated situation for Chávez’s successor, Nicolás Maduro, as we will discuss in the next post. 

​
References

Guevara, Aleida.  2005.  Chávez, Venezuela, and the New Latin America.  Melbourne: Ocean Press.

Chávez Frías, Hugo. 2006.  La Unidad Latinoamericana.  Melbourne: Ocean Sur.  


Key words: Chávez, Venezuela, socialism, Bolivarian Revolution

Posted August 9, 2016

        At his presidential inauguration in 2014, Nicolás Maduro observed that he is the first worker president in the history of Venezuela, and that he is the first president who is Chavist, that is, an activist in the Bolivarian Revolution led by Hugo Chávez.  Maduro is a former bus driver who received his formation in political, historical and ethical consciousness through union leadership.  During the neoliberal era, he was a candidate of the old Socialist Party for president.  He later became a leading member of the Bolivarian Fifth Republic Movement of Chávez.  He was minister for foreign affairs of the Chávez government, and he attained a level of international recognition for his elegant discourses in defense of the Bolivarian Revolution in various international fora.  When Chávez became ill with cancer, he called upon the Bolivarian Movement to name Maduro as his successor, a request made, he said, “from my heart.”  Initially serving as interim president, Maduro was elected president for a full term in 2013, in accordance with the 1998 Constitution.

     The Maduro presidency has been characterized by an escalation of the strategies of the Right to destabilize the government of Venezuela, seeking to take advantage of the death of Chávez.  In February 2014, fascist gangs were organized to attack citizens and property, and the international media falsely presented the violent groups as peaceful student protestors.  There were calls for US intervention.  But Maduro weathered the storm.  The government arrested and prosecuted, in accordance with the law and the constitution, thirteen persons.  And it proposed dialogue with the moderate opposition, with the promise of attending to any legitimate demand or grievance.  Thus, the government was able to prevail in the first stage of the conflict by isolating the violent extreme Right.

     The Venezuelan economy, however, is overly dependent on oil income, and it imports many necessities, such as food and medicine.  The government of Chávez gave emphasis to taking control of the oil industry, channeling oil revenues to social missions, and developing a foreign policy of cooperation and unity with Latin America and the Caribbean, offering favorable terms of oil purchases as a dimension of the policy.  The diversification of the economy and increasing national production were long-term goals, but they have not yet been achieved, and the national economy remains overly dependent on oil and on the importation of necessary goods.

     In 2014, there was a sharp decline in oil prices.  Seeking to take advantage of this situation to promote destabilization, Venezuelan import-export companies, which form an important part of the opposition, ceased with their importation and sale of necessary goods, thus producing shortages and inflation.  In addition to this economic war, violent gangs were organized.  The international news media began to portray Venezuela as a country in crisis and civil disorder.  

     Most people think in concrete terms about the problems they confront, and not with a political, economic, and historical perspective. When problems like shortages and high prices occur, most people blame the government, and they do not necessary have a clear understanding of the sources of the problem.  In the case of Venezuela, the opposition created a problematic situation for the people through its economic war, and then it sought to take advantage of this situation, blaming the government for it.  Many people did not have sufficient political consciousness to reject the opportunistic opposition for its treasonous behavior in defense of its particular interests and in defense of foreign interests.

     The experience of revolutions teaches us that a popular revolution can attain the active and committed support of twenty-five to forty percent of the people.  There will emerge an opposition of ten to fifteen percent, composed of those economic sectors with a particular economic interest in the preservation of the old order, a consequence of its privileges in the neocolonial world-system; and of middle class or urban individuals who are confused by the ideological distortions of the mass media, controlled by the corporations.  Thus, there are approximately fifty percent of the people that are neither with the revolution nor with the opposition in a committed form.  Their lack of commitment has the consequence that they have a less developed understanding of the national and global political and economic issues. For the most part, they support the revolution, as long as things are going relatively well, and they are not called upon to make sacrifices. But the revolution can temporarily lose the support of the “ninis” (neither for nor against the revolution) under particular conditions. 

      The economic war of 2014 and 2015 in Venezuela had the consequence that the Bolivarian Revolution lost the support of the “ninis” in the parliamentary elections of December 2015.  Political parties of the opposition had formed a coalition, the Table for Democratic Unity (MUD for its initials in Spanish).  With MUD parliamentary candidates speaking in vague terms in favor of change, the opposition coalition took a majority of the seats, although the party of Chávez remains the largest single political party.  

     But MUD did not arrive to a parliamentary majority with a political platform.  It envisions a return to the neoliberal past, a vision not expressed to the people in the parliamentary campaigns.  The more that MUD proposes or implements neoliberal policies, the more it risks popular rejection.  So the strategy of the parliamentary opposition has been to seek to remove Maduro from office prior to the completion of his term, and to destabilize the constitutional process, possibly ensuring its control of the government in a post-Chávez era through US military intervention.

      In the face of this situation, the government of Maduro has called for respect for the constitutional process, maintaining that the parliamentary majority ought to recognize the constitutional limits of its authority and respect the authority of the executive and judicial branches and the counsel on elections.  In response to the economic war, the government has attempted to supply necessary goods at lower prices in state stores, but the process is complicated by the phenomenon of opportunistic individuals purchasing goods and reselling at higher prices.  In addition, the government has intensified and expanded its efforts in the diversification of the economy, the expansion of national production, and the further development of popular councils.  

      It is to be expected that the unfolding global popular revolution will have its setbacks.  The forces opposed to its agenda are powerful, inasmuch as they include the governments of the most powerful nations as well as the largest international corporations, which control the international media of communication; and they include those sectors of the national bourgeoisie connected to international capital. Moreover, the transformation of the established structures of the world-system, which promote the underdevelopment of the majority, confronts many obstacles.  We must constantly keep in mind two fundamental facts.  First, those who oppose the popular revolution have no viable alternative proposal.  They can only imagine the continued implementation of neoliberal economic policies and the unleashing of neo-fascist wars.  They point the road toward the certain continuing spiral of decline into chaos and violence and the possible extinction of humanity.  Secondly, the achievements of the Third World popular revolutions for national and social liberation are remarkable. They have accomplished fundamental structural transformation of some nations, and they have formulated a consensual Third World proposal for a more just, democratic and sustainable world-system, pointing to an alternative road for humanity.

     The road of social transformation has its setbacks, but humanity is on that road, led with wisdom, dignity and courage by the formerly colonized peoples of the earth.  We the peoples of the North must find the wisdom and the courage to discern the unfolding human drama and to stand committed with the political and moral alternative emerging from below.


Key words: Venezuela, Maduro, opposition, economic war, Bolivarian Revolution

Posted August 11, 2016

     Bolivia, a landlocked country in the mountains, historically has been the poorest country in South America.  It is the most indigenous country of Latin America, with 61% of the population identifying themselves as pertaining to one of several original nations of the region.

      In accordance with the norms and patterns in the development of the modern world-system, Bolivia has played a peripheral role in the world-economy, supplying raw materials for the core nations on a foundation of cheap labor.  Systems of forced labor were imposed following Spanish conquest of the Inca Empire, which included the indigenous nations of present-day Bolivia.  During the course of time, first silver, then tin, and then natural gas and petroleum were extracted and exported to the industrializing economies of the North

     From the sixteenth to the twentieth centuries, Bolivia’s peripheral function in the world-economy existed alongside autonomous indigenous communities, which were agricultural societies with communal forms of land ownership.  As the world-economy expanded, it increasingly consumed indigenous land and autonomy, such that by 1930, the indigenous lands comprised only one-third of national territory, and the numbers of landless peasants exceeded the number of persons living in indigenous communities.

     Bolivian mine workers, peasants, and factory workers formed a popular movement during the twentieth century, resulting in a government committed to the developmentalist project from 1930 to 1985.  As was the case generally in Latin America, the project was forged through an alliance between the popular sectors and the national bourgeoisie.  It made some concessions to popular demands and provided some protection for national industry, without threatening the interests of foreign corporations.  

     Beginning in 1985, the neoliberal project of the global powers was imposed in Bolivia, resulting in the elimination of the modest protective measures for the people and for national industry that were put in place from 1930 to 1985.  In the 1990s, mass mobilizations emerged, protesting specific measures that were part of the neoliberal package. From 2000 to 2006, the popular movement intensified, with mass mobilizations, road blockings, general strikes, work stoppages, and hunger strikes, culminating in the resignation of the president in 2005 in the midst of a generalized chaos.

      As the renewed popular movement unfolded in the period 1990-2005, new political parties were formed, and they were effective in undermining popular support for the traditional political parties that had cooperated with the imposition of the neoliberal project.  One of the parties was the Movement toward Socialism (MAS), a federation of social movement organizations and unions, founded in 1995.  Its principal leader was Evo Morales, an indigenous coca farmer who had been born and raised in a poor town in the Bolivian high plains and who emerged as a leader in the coca farmers’ union.  Proposing a constitutional assembly and the nationalization of the natural gas and petroleum companies, Morales won the presidential elections of December 18, 2005.  

     The newly-elected government of Evo Morales immediately sought to put into practice an alternative economic model based on control of the natural resources of the nation and the establishment of national sovereignty.  Seeking to break the core-peripheral relation, it followed a vision of an autonomous development that responds to the demands of the popular movement, which includes indigenous organizations, peasant organizations, unions of workers in the petroleum and gas industries, professionals, and small and medium sized businesses.

     In accordance with his campaign promise and a fundamental popular demand, Morales convoked a Constitutional Assembly, which assembled to begin the formulation of a new Constitution on August 6, 2006.  Although confronting various maneuvers by the opposition, the new Constitution was approved by popular referendum on January 25, 2009, with 61.4% of the vote.  The new Constitution recognizes the autonomy of the indigenous communities, and thus it establishes the Plurinational State of Bolivia.  The Constitution establishes a maximum extension of land of 5000 hectares for personal property; it guarantees access to health services, education, employment, and potable water as constitutional rights; and it prohibits the establishment of a foreign military base in the country.

      The government of Evo Morales renegotiated contracts with natural gas and petroleum companies, resulting in a great increase in state revenues, which are used to develop a variety of social programs, including programs in literacy and credit for small farmers. The Morales government has initiated a land-reform program, beginning with the appropriation of land that was unproductive or that was fraudulently obtained, a common practice during the era of the neoliberal governments.  And Bolivia became the third member of the Bolivarian Alternative for the Peoples of Our America (ALBA), joining Venezuela and Cuba.  

     By 2007, a counterrevolution had taken shape, formed by the owners of the large estates, large-scale businesspersons, leaders of the traditional political parties that benefitted from the previous political-economic order, and transnational corporations.  The US government has provided financial support to the counterrevolution. But Morales and MAS have been able to maintain political control.

     In 2009, Evo Morales was re-elected president of Bolivia with 64.22% of the popular vote.  MAS won a majority in the National Assembly, including a two/thirds majority in the Senate.  MAS won control of six of the nine departments of the country and 228 of the 337 municipalities.

     Along with Hugo Chávez of Venezuela and Rafael Correa of Ecuador, Evo Morales has emerged as one of the charismatic leaders in the new political reality that has been forged in Latin America, which has challenged not only the neoliberal project but also the structures of the neocolonial world-system.  Reflecting this reality, Bolivia served in 2014 as the President of the G-77 plus China, and Morales led an anniversary commemoration in which the presidents adopted a declaration, “Toward a New World Order for Living Well.”  In a subsequent post in this series on the Third World project, we will discuss this declaration, which is an indication of the international leadership of Evo Morales, and which echoes historic declarations of Third World charismatic leaders before international fora during the period 1948 to 1983.   

​

Bibliography
 
Moldiz Mercado, Hugo. 2006. “Crónica del proceso constituyente boliviano” in Contexto Latinoamericano: Revista de Análisis Político, No. 1 (Sept-Dec), Pp. 10-22.
 
__________.  2008.  Bolivia en los tiempos de Evo.  Mexico City: Ocean Sur.
 
__________.  2008. “Bolivia: la recta final” in Contexto Latinoamericano: Revista de Análisis Político, No. 7, Pp. 15-27.
 
__________.  2010. “Revolución democrática en Bolivia,” IX Conferencia de Estudios Americanos, Centro de Investigaciones de Política Internacional, Havana, Cuba, November 19, 2010. 
 
Puente, Rafael.  2010. “Bolivia: la nueva Constitución, meta y punto de partida” in Contexto Latinoamericano: Revista de Análisis Político, No. 12, Pp. 19-26.
 
Stefanoni, Pablo.  2007. “¿A dónde va la Bolivia de Evo? Balance y perspectivas en un año de gobierno” in Contexto Latinoamericano: Revista de Análisis Político, No. 3 (April-June), Pp. 82-90.

 
Key words: Bolivia, Evo Morales, MAS, socialism
 

Posted September 19, 2016

       My most recent posts on the Third World project have been discussing the renewal of the Third World project since 1994.  They have included posts on Venezuela and Bolivia, focusing on the post-1994 emergence of social movements that have taken political power and established new constitutions, proclaiming that they seek to construct socialism for the twenty-first century.  I continue today with reflections on the “Citizen Revolution” and the emergence of Rafael Correa as a charismatic leader in Ecuador.

     A popular movement in Ecuador in opposition to neoliberal policies emerged in the late 1990s.  By 2005, the movement arrived to express widespread popular disgust with the established political class and the traditional political parties.  Popular mobilizations were demanding the dismissal of the President, the Supreme Court, and all the politicians. The popular movement was opposed to the structural adjustment policies that required cutbacks in education, public health and social security in order to make payments on the external debt; it demanded payment of the “social debt” before the external debt.  The movement rejected the failure of the political establishment to defend the sovereignty of the nation before the neocolonial intentions of the United States.  It was opposed to the US proposal for a Free Trade Area of the Americas (FTAA), and it called for terminating the US military base in Ecuador and Ecuadorian participation in the US-sponsored Plan Colombia.

      In 2006, Rafael Correa emerged as the leader of the popular movement.  Correa was born into the lower middle class, but he was able to attend the university and subsequently earn masters’ degrees in the United States and Belgium, becoming a college professor in Ecuador.  As a young man, he worked in Catholic missions among the poor, and he continues to be a practicing Catholic.  He arrived to national prominence in 2005, when at the age of 43 he was named to the cabinet of the government of Alfredo Palacio and immediately proceeded to publicly criticize the International Monetary Fund.  As Minister of the Economy, he promised to channel petroleum income more toward social services and less to the payment of the external debt.  He asserted that he intended seek a renegotiation of the debt payments, and that a proposed Free Trade Agreement with the United States would be submitted to a popular consultation.  However, because of conflicts with the government of Palacio, Correa resigned his post.

     By now a favorite of the middle class, Correa established an alternative political party, Nation Alliance, which decided to enter only the presidential elections and not congressional elections, placing its hopes in the immediate formation of a Constitutional Assembly. Correa finished second among 13 candidates in the 2006 presidential elections, receiving 23% of the vote, thus qualifying for the run-off elections.  His support was mostly from the middle and upper-middle classes, especially progressives that had ties to social foundations and non-governmental organizations.  He received a low percentage of votes from the poor sectors, as a result of the fact that he had not been involved in the popular mass organizations or the political parties of the Left.  

     In the run-off elections, however, Correa received the endorsements of labor, peasant, and indigenous organizations as well as some of the political parties, which viewed him as a much better option than Álvaro Noboa, who had the support of the Ecuadorian national bourgeoisie, the government of the United States, and transnational companies.  Noboa supported the proposed FTAA, and he proposed changes that would strengthen foreign investment and facilitate access of international capital to Ecuadorian natural resources, including petroleum.  He favored privatization, including those sectors that provided vital human needs to the population.  He also asserted that Ecuador ought to break relations with Cuba and Venezuela.

     Standing in sharp contrast to Noboa, Correa declared during the campaign that he would renegotiate the Ecuadorian external debt with the international finance agencies, basing the negotiation on conditions established by the Ecuadorian state, and not on conditions laid down by the international finance agencies.  He promised that his government would not sign a Free Trade Agreement with the United States, and that instead of an economic integration with the United States based on “free trade,” Ecuador ought to be oriented toward an economic and social integration with Latin America, seeking to strengthen ties with emerging regional associations as well as Venezuela and Cuba.  He also declared that his government would not renew the agreement with the United States for the use of the Ecuadorian Air Force Base in the city of Manta by the U.S. military, when this accord terminates during 2009.  And he declared that he would not permit the country to participate in the Plan Colombia of the United States.  Correa asserted that he would convoke a Constitutional National Assembly, thus establishing alternative structures that would create new mechanisms for the effective participation of the citizens in the public decisions of importance for the country.  The Constitutional Assembly ought to be formed by the various sectors of the country, including representatives of workers, peasants, students, and retired persons.


    Correa defeated Noboa in the run-off presidential elections with 59% of the vote, and he assumed the presidency on January 15, 2007. That same day, he initiated the steps for a popular referendum on a Constitutional Assembly. The National Congress, in which Nation Alliance did not have representation, tried to block the referendum, but the Electoral Court, taking into account the strong popular sentiment for a referendum, ruled that it should be held.  In March 2007, a popular referendum approved the convocation of a constitutional assembly.  On September 30, elections to the Constitutional Assembly were held, in which 70% of the voters supported candidates that shared the political-economic project of Correa, and Nation Alliance won 80 of the 130 seats in the Constitutional Assembly.  A new Constitution was developed by the Assembly, and it was approved in a popular referendum.

     Under the new Constitution, elections for President, Vice-President, and the Legislative Assembly were held on April 26, 2009.  Correa won the elections on the first round, with 51.94% of the votes, far ahead of Lucio Gutierrez with 28.24% and Álvaro Noboa with less than 8%.  The Nation Alliance attained an ample victory in the elections for Legislative Assembly, and the Pachakutik movement, the Democratic Popular Movement, the Socialist Party also won strong representation, giving overwhelming control of the Legislative Assembly to the newly formed non-traditional parties of the Left.  Correa was re-elected president in 2013; the Nation Alliance and its allies from newly-formed non-traditional parties of the Left continue to have a strong majority in the Legislative Assembly.

    In addition to a new Constitution, the Correa government has renegotiated external debt payments on the basis of the principle that it will make payment only on debt that was legitimately contracted, with the result that for the first time, social spending has exceeded payment of external debts.  It has stimulated investments in strategic industries, such as the hydroelectric industry, petroleum refineries, and the transportation infrastructure.  It has provided incentives to national production, with the intention of responding to the food needs of the population.  It has nationalized property poorly utilized.  It has not renewed the agreement for the U.S. military base in Manta.  

    Correa maintains that the Citizen Revolution in Ecuador seeks to construct “Socialism for the XXI Century,” which involves a form of socialism “applied to the particularities of Ecuador.”  Correa maintains that Socialism for the XXI Century has important points of coincidence with the scientific socialism of Marx and Engels, including the principle that “it is the people who ought to command, and not the market” as well as the concept of “the importance of collective action.”  

     But socialism for the XXI century, Correa maintains, is different from classic socialism.  First, while classic socialism “sought state ownership of all the means of production,” Ecuadorian socialism for the XXI century seeks state ownership only of those means of production that “are strategic for the economy of the nation, and therefore cannot be in private hands.”  Secondly, classic socialism had a concept of development not very different from that of capitalism, in that it utilized “the same concept of industrial development and growth in production.”  But socialism for the XXI century seeks to formulate and practice an alternative model, based on the concept of sustainable development.  Thirdly, socialism for the XXI century expresses itself in various forms, without the model of one country being replicated in another.  “We ought to speak of principles, and not of models” (Correa 2014).

     On January 29, 2015, Ecuador and Rafael Correa assumed the presidency of Community of Latin American and Caribbean States (CELAC).  Founded in Venezuela in 2011, CELAC consists of the governments of the 33 nations of Latin America and the Caribbean.  It is the culmination of the process of Latin American and Caribbean unity that has been unfolding since 2001.  It is conceived as an alternative to the Pan-American project, which the United States imposed following World War II as a project of economic integration and political cooperation under US direction (see “Pan-Americanism and OAS” 10/2/2013). 

     In his speech at the closing of the Third Summit of CELAC in Costa Rica on January 29, 2015, Correa invoked the memory of the heroes of Latin America and the Caribbean, including Toussaint, Bolivar, Zapata, Sandino, Che, Allende, and Chávez.  And he maintained:

​     Correa proposed that CELAC would work toward implementation of a plan of action focusing on five central themes: the reduction of extreme poverty and inequality; the expansion of education and the development of research and knowledge in a form that serves the public good; the protection of the environment and the struggle against climate change; the development of an alternative regional financial infrastructure; and the strengthening of the power of CELAC as a regional bloc.

     He noted that the establishment of diplomatic relations between Cuba and the United States, although it does not end the US blockade that violates international law, represents a “victory of the Cuban people [that] is a true lesson in dignity, resistance and sovereignty that Cuba transmits to the world.”  He also criticized the United States for its manipulation of the issue of human rights as a mechanism to preserve structures of neocolonial domination.

      Correa criticized the historic conduct of transnational corporations in Latin America and the Caribbean, and he noted that bilateral treaties of investment obligate the states of the region to surrender their sovereignty to courts in the North, which act in an arbitrary manner to sanction unjust arrangements.  “Latin America and the Caribbean needs foreign investment, but we ought to take on the task of creating a more just and balanced framework of relations between States and transnationals, which would make possible mutual benefit and respect for human rights and the rights of nature.”

     He concludes:

    For the full text of Correa’s speech at the Third Summit of CELAC in Costa Rica on January 29, 2015, see “The eradication of poverty is a moral imperative for our region and for the entire planet.”

Reference
 
Correa, Rafael.  2014.  Ecuador: De Banana Republic a la No República.  La Habana: Fondo Editorial Casa de las Américas.
 
 
Key words: Correa, Ecuador, revolution, socialism for the 21st century, CELAC

Posted September 20, 2016

     The Sandinista Front for National Liberation (FSLN for its initials in Spanish) was established in 1963, unifying the guerrilla groups that were seeking to overthrow the US-supported Somoza dictatorship by means of armed struggle.  It was named for August C. Sandino, who from 1927 to 1934 formed and led a peasant army, the Army in Defense of National Sovereignty, in opposition to US military occupation of Nicaragua.

     The Sandinista Revolution triumphed on July 19, 1979, and it was in power from 1979 to 1990.  It developed a new constitution, following the principles and practices of representative democracy.  The first elections under the new constitution were held in 1984, and Daniel Ortega of the FSLN was elected president, receiving 63% of the vote. During its rule from 1979 to 1990, the Sandinista government developed a program consistent with long-standing goals and proposals of the Latin American popular movement, including: nationalization of companies that had been owned by Nicaraguans who abandoned the country following the fall of Somoza; programs in health, literacy and education, and food production; and an agrarian reform program.  These measures resulted in significant reductions in illiteracy and poverty.  Nationalization and agrarian reform led to redistribution and decentralization of land: Under Somoza, properties of fifty acres or more comprised more than half of the arable land; but today, they comprise 18%, with 82% in the hands of small farmers and cooperatives.  In foreign policy, the Sandinistas followed a policy of non-alignment, seeking to diversify its commercial relations to include the socialist bloc and the Third World in addition to the United States and Western Europe (Fonseca 2009:49-50; Prieto 2008:34-36; Regalado 2008:78; Walker 1991).  

     Beginning in 1980, the United States embarked on an economic, ideological and military campaign against the Sandinista government, including economic and military assistance to a counterrevolutionary guerrilla army known as the contras, most of which were stationed in Honduras along the Nicaraguan border (Booth and Walker 1993:140-46).  The contra war was a key factor in the Sandinista loss in the 1990 elections to a coalition of parties supported by the United States.   Although the election brought to an end Sandinista control of the government, it had the positive consequence of establishing an environment that facilitated the signing of peace accords and the disbanding of the contras, bringing to an end the costly conflict.

     From 1990 to 2006, the Nicaraguan state was directed by governments that implemented neoliberal economic policies.  The illiteracy rate tripled, and gains in health were rapidly reversed, while “a negligible minority was enriched without end” (Prieto 2009:147). Nonetheless, the gains represented by the Sandinista project were not completely reversed.  The country continued to follow the democratic constitution developed during the Sandinista government.  The military, which was formed from the Sandinista guerrilla army and had replaced the brutally repressive National Guard of Somoza, continued during neoliberal rule.  And the Sandinista party comprised approximately 40% of the national assembly, the largest single party in the nation, during the period.  The neoliberal governments of 1990 to 2006 could not roll back the redistribution of land that had been implemented by the Sandinista government.

     Revitalized by the renewal of Latin American popular movements beginning in 1994, Ortega and the FSLN were returned to power in the elections of 2006.  During the Second Phase of the Sandinista revolution, initiated in 2007, the government of Daniel Ortega has had more success in diversifying trade relations and investment partners, leading to investments from a variety of new sources.  In addition, the Sandinista government has been able to build upon the family and cooperative economy established by the redistribution of land during the first phase.  Families and cooperatives produce 53% of the GDP and employ over 70% of the workforce in what the Sandinistas describe as a “popular, non-capitalist economy.”  Ninety percent of consumed foodstuffs are produced in the domestic economy; a cooperative bank with 50,000 associates in an important financial resource, independent of the private banking sector; and popular markets are the main distributors of imported goods.  In its second phase, the Sandinista Revolution is having success combining state ownership in key sectors with small scale private property and cooperatives.  The Sandinista economic model has been described as “inclusive domestic economic democratization” by Tortilla con Sal, a collective based in Nicaragua.  It is a model that has emerged from the particular conditions of Nicaragua, and it is a component of the Sandinista quest for sovereignty with respect to its political-economic system and its foreign policy, independent of the historic imperialist and neocolonial demands of the United States or the more recent neoliberal demands of international finance agencies.  

References
 
Booth, John A. and Thomas W. Walker.  1993.  Understanding Central America, Second Edition.  Boulder:  Westview Press.
 
Fonseca Terán, Carlos.  2009.  “El socialismo del siglo XXI desde la Revolución Popular Sandinista” in Contexto Latinoamericano: Revista de Análisis Política (No. 11), Pp. 43-55.
 
Prieto Rozos, Alberto.  2009.  Evolución de América Latina Contemporánea: De la Revolución Cubana a la actualidad.  La Habana: Editorial de Ciencias Sociales.
 
Regalado, Roberto.  2008.  Encuentros y desencuentros de la izquierda latinoamericana: Una mirada desde el Foro de São Paulo.  México D.F.: Ocean Sur.
 
Walker, Thomas W.  1991.  Nicaragua:  The Land of Sandino, Third Edition.  Boulder:  Westview Press. 
 
 
Key words: Nicaragua, Sandinista, Ortega, Socialism