[Marxism] Fwd: Oil prices fall to $39/bbl

Ruthless Critic of All that Exists ok.president+nbsy at gmail.com
Sun Mar 8 07:50:28 MDT 2009

On Thu, Dec 18, 2008 at 2:43 PM, Sky Keyes-Vogt <skeyesvogt at gmail.com> wrote:
> David Walters said:
> It means that Venezuelan crude is falling down to about $34/bbl due to it's
> inferior quality.
> me:
> I'm interested in comrades' opinions about the effect this will have on
> Venezuela, particularly since much of the social funding is purportedly
> coming from 'petro-dollars.'  I would think that either the lack of money
> will lead to a slowdown of the Bolivarian process, and thusly demoralization
> among its ranks and a chance for the right-wing to make some gains; or it
> will force the left to boldly attack the right so that they can sustain
> current projects and extend them.  I guess my question is:  Can things
> continue as they are in Venezuela given this drop in oil price?

Latin America: Captive to Commodities
By Forrest D. Colburn


Surprisingly, the three countries said to be governed by the “left”
are most dependent on the commodity boom. Venezuela and Ecuador are
dazzled by their oil revenue, and Bolivia is euphoric with the value
of its natural gas. (Their junior partner, Nicaragua, has little of
its own, but has placed its hope in Venezuela’s sharing its oil—and
oil revenue.) In Venezuela, Ecuador, and Bolivia, hydrocarbon
resources are firmly in the hands of the state, and their respective
heads-of-state—Hugo Chávez, Rafael Correa, and Evo Morales—intend to
use this valued resource for a social transformation. However, the
reigning ideology is little more than social resentment and a distrust
of private initiative. There is no new model for how to organize the

A Salvadoran friend, dark-skinned and of short stature, recounts—in
private—a telling conversation with a minister in the Morales

“Whites have never respected us—now we are teaching them to respect us
through force.”
“But your economic policies are not working; they are creating hardship.”
“Whites have been robbing Bolivia and leaving nothing but misery for centuries.”
“Yes, but what you are doing is not making things any better.”
“We have earned the right to be wrong.”

The Salvadoran was duly impressed with the accumulated rancor in
Bolivia—and the extent to which it is shaping public policies,
especially those that target the private sector.

Venezuelans perceive something similar in their country. However, in
Venezuela—and in Ecuador—social resentment is not based on race but on
social class. Indeed, one Venezuelan academic reports that the
“revolution” is about exacting revenge, not about improving the
welfare of the poor. He asserts that most poor Venezuelans don’t
really expect that their lives will be made more comfortable, but they
are pleased that those held responsible for their poverty will be

In each of the three countries, the private sector is being
intimidated, forcefully regulated, or outright dismantled. Attacks on
the private sector are most pronounced in Venezuela, and they take
diverse forms. For example, the center of industry in the country is
in Guayana: half the factories in the region’s industrial park have
closed, the others suffer from shortages of raw materials, labor
agitation, and raids by gangs looking to steal anything of value. The
shortage of inputs is tied to state control of foreign exchange,
necessary for purchases abroad. Despite the country’s healthy
reserves, there are delays of months for the approval of imports. Most
labor agitation is held to be politically inspired and coordinated.
There is even speculation that organized crime is politically driven.
The net effect is a decline in the production of everything but
petroleum. The state does not have an alternative “model” of
production, but Chávez doesn’t seem worried: gaps in foodstuffs and
consumer and capital goods are simply made up with imports funded by
oil revenues. Venezuela’s “development model” is an extended charity
program paid for by the international sale of a single commodity—oil.
What happens, though, if the price of oil falls? Whatever else he may
be accomplishing, Chávez is increasing Venezuela’s dependence on the
export of oil.

IN ECUADOR and Bolivia, political rancor—and a generalized hostility
to the private sector—has exacerbated regional divisions. In Ecuador,
the impoverished highlands area (sierra) is largely sympathetic to the
indictment of the private sector. In contrast, the humid coast, where
entrepreneurs produce bananas, shrimp, and other products for export,
largely opposes the Correa government. Likewise, the more recently
settled, and more productive, lowlands of Bolivia oppose Morales,
whose base is in the arid highlands—home to the country’s indigenous
population. In a bid to consolidate his hold on the country, Morales
held a referendum: the joke is that he won what is left of Bolivia. In
fact, Morales is said to be unable even to visit four of the country’s
nine departments, the four that have declared their “autonomy.” In
both Ecuador and Bolivia commodity revenue—real or anticipated—seems
to have generated a kind of political intoxication and contributed to
divisive policies.

Social resentment is neither an ideology nor a development strategy.
Venezuela, Ecuador, and Bolivia are not faring well. Their future is

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