[Marxism] Venezuela: oil royalties versus capital flight

Jurriaan Bendien andromeda246 at hetnet.nl
Thu Aug 19 14:58:17 MDT 2004

Hi Xxxxxx,

What I was referring to is that through the 1990s the government levy on the
oil industry in Venezuela declined proportionally regardless of the total
volume of export sales. These export sales include not just oil, by the way,
but oil is of course the bulk of it, by value. As Mommer explains, the
general neoliberal strategy is to wrest the oil industry from state
controls, state controls which aim to use oil profits to stimulate local
economic development.

The true "rent" from crude oil extraction and surplus-profit from oil
products obtained, above gross production-costs, to my way of thinking isn't
proportionally large enough to explain what's really happening. But
admittedly I haven't studied the world oil market in depth, it's a lot of
work. Price formation in this area is complex, because it involves
extraction, refining, distribution, and taxation under semi-monopoly or
monopoly conditions, with the additional factor of speculation in oil

I don't really understand the argument behind the idea that Chavez is
enacting a "value transfer from the world working class". Insofar as
Venezuela is part of OPEC, and insofar as oil prices are set by the world
market, there is very little that Chavez can do on his own to affect oil
prices or international value transfers. Any price-rise increasing the
cost-structure of production, that feeds into consumer prices, is to the
detriment of the ordinary workers and the poor, insofar as it affects
standards of living and employment levels.

You write: "A populist revolution built on the appropriations of a rentier
state is not generalizable to the rest of the world." Generalizable in what
sense ? There is a tendency in some Leftist circles to regard each new
revolutionary uprising as a beacon or model of socialism, or as an ideal to
which one should aspire at home, but beyond generalities about where
political commitments should be, that idea is obviously questionable since
in different countries conditions are different. Be that as it may, I regard
Chavez's basic strategy as progressive, and worthy of support. Note also
that Cuba receives a very large supply of oil and oil credits from
Venezuela, and if Chavez was not there, Cuba would need to obtain oil from
somewhere else, at a much greater cost.


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