Hugo Chavez Announces Nationalizations, Constitutional Reform for Socialism in Venezuela

By: Gregory Wilpert – Venezuelanalysis.com

Caracas, January 8, 2007 (venezuelanalysis.com)— During the swearing-in ceremony of his new cabinet, Venezuela’s President Chavez announced a series of dramatic new measures for moving ahead in establishing 21st century socialism in Venezuela. Among these new measures are the convocation of a new constitutional assembly and the re-nationalization of key industries.

In his speech Chavez characterized the preceding years of his presidency, 1999-2006, as a “phase of transition,” which ends now, and that “we are now entering a new era, the National Simon Bolivar Project of 2007-2021.” This project would head towards “Bolivarian Socialism, which requires greater levels of effort and engagement, clarity and efficiency, and revolutionary quality,” said Chavez. The year 2021 is significant for Chavez because it is the 200th anniversary of Venezuelan independence.

This new project, which Chavez promised to outline in greater detail during his own swearing-in on Wednesday, for his second full presidential term, consists of five “motors”: an “enabling” law, constitutional reform, popular education, reconfiguration of state power, and explosion of communal power.

1. Enabling law (ley habilitante), which Chavez referred to as the “mother law” of the project. This law would allow Chavez, over the period of one year, to pass laws on specified issues as decrees. This type of law has been given to Venezuelan presidents on several occasions before, such as during the first presidency of Carlos Andrés Perez (1974-1979) and early in Chavez’s presidency, following the passage of the 1999 constitution, to bring the country’s laws up to date to the new constitution.

Chavez said that part of this enabling law would be the nationalization of key industries that had been privatized under previous governments, such as the telecommunications company CANTV and the electricity companies. “All of that which was privatized, let it be nationalized,” said Chavez.

CANTV’s shares dropped by 14.2% following the announcement, until the New York Stock Exchange halted trading of CANTV shares. The former state company was privatized in 1991.

Also, his government would push for changing the minority stake the state oil company has in four Orinoco Oil Belt projects into a majority stake. The four Orinoco joint ventures are with the U.S. companies ExxonMobil, Conoco, and Chevron, France’s Total, Britain’s BP, and Norway’s Statoil. Together these produce 600,000 barrels of oil per day, about 18% of Venezuela’s total production. This move follows an earlier move to create joint ventures out of foreign companies’ operations in marginal oil fields.

Chavez also suggested that other revolutionary laws would be passed per decree as part of this enabling law. The text of the enabling law is nearly ready and would soon be presented to the National Assembly.

2. Constitutional reform is the second motor for the new phase of the Bolivarian Revolution. Chavez did not say what kinds of changes he envisioned, other than to say that this would require a “constituent power” [constitutional assembly]. Just as eight years ago we convoked [this power], I invoke and convoke the constituent power, the popular [grassroots] power, the true combustible so that these motors that I am talking about can bring us to a better future.”

One constitutional change Chavez did mention today would be to abolish the independence of the Central Bank, saying that such independence is a tool of neo-liberalism. Another change that Chavez has mentioned in the past is the possibility of getting rid of the two-term limit for presidential terms.

3. The third “motor” is the launch of a new drive for “Bolivarian popular education,” which would, “deepen the new values and demolish the old values of individualism, capitalism, of egotism,” said Chavez.

4. “A new geometry of power for the national map,” said Chavez is the fourth “motor,” which he admitted sounded rather abstract. Chavez explained that what he was referring to was the need to reorganize political power in Venezuela, so that the marginalized poorer areas, such as Apure state, would be more included. Also, he said that a law that his supporters had passed, the law of municipal councils, was not working and needed to be reformed.

5. Explosion of communal power, said Chavez, is the most powerful motor of this next phase. According to Chavez, this refers to giving more power to the recently created communal councils of 200 to 400 families, which would eventually eclipse the existing power structures, so as to create a “communal state.” What is needed, said Chavez, is to “dismantle the bourgeois state” because all states “were born to prevent revolutions.” Instead, the old state would have to be turned into a “revolutionary state.”

OAS General Secretary is an “Idiot” (Pendejo) for Interfering in Venezuela

Defending his decision not to renew the broadcast concession of the oppositional TV station RCTV, Chavez attacked OAS General Secretary Miguel Insulza, who had urged Chavez to reconsider the decision. RCTV’s broadcast concession is to expire in late May and Chavez announced last week that he would not renew it because RCTV has been acting irresponsibly because of its support of the 2002 coup attempt and of the oil industry shutdown.

According to the AP, Insulza issued a statement last week in reaction to Chavez’s announcement, in which he stated, “The closing of a mass communications outlet is a rare step in the history of our hemisphere and has no precedent in the recent decades of democracy,” Insulza also warned of the "political repercussions" that the action could bring.

He went on to say that any move that forces RCTV to close “gives the appearance of a form of censorship against freedom of expression and at the same time serves as a warning against other news organizations, leading them to limit their actions at the risk of facing the same fate.”

Chavez reacted very angrily to Insulza today, saying that Insulza is an “idiot” (pendejo) and called for his resignation. A General Secretary “who reaches this level must, out of dignity, leave his office,” said Chavez, adding, “Unless someone wants to once again convert the OAS into what Fidel Castro once called … the ministry of the colonies.”

Venezuela would denounce Insulza in the next OAS meetings because of “interference and lack of respect.” “We are not afraid, you are quite wrong,” said Chavez, addressing Insulza.

Venezuela has received widespread international criticism for the plan not to renew the RCTV concession, but Chavez has said that he does not care about such reactions and that his decision was irreversible and completely within the scope of Venezuelan law, which gives the executive discretionary power over the renewal of broadcast licenses. Venezuela’s communications minister Willian Lara has suggested that RCTV does not need to close once its license runs out because it sells programs throughout the continent and it could also opt offer its programming on cable.

See also: Chavez Swears-In New Cabinet for “Venezuelan Path to Socialism”