By depleting the stocks of basic goods and unleashing speculation, the oligarchy opposing the government has imposed great difficulties on the daily lives of the majority of the Venezuelan people. The corporate media focused on the shortage of cornmeal, essential in the making of arepas, a staple of the Venezuelan diet, and other everyday products to condemn the Bolivarian government as unable to ensure the population’s normal life and try to arouse the people to deep dissatisfaction with the government.
The nongovernmental organizations financed by the State Department’s U.S. Agency for International Development, the Colombian ultra-right represented by former President Álvaro Uribe and the Venezuelan pro-coup right-wing have intensified their offensive following the death of Commander Hugo Chávez and after Nicolás Maduro assumed Venezuela’s presidency.
However, up to now the new government’s strategies have defeated all the destabilizing campaigns. Despite facing enormous difficulties inherent in the rapid succession to the Chávez government, the new administration has consistently found solutions that work to the people’s benefit.
Passage of Enabling Law
After joint actions of the people and governmental brigades established that the shortage of products was the result of hoarding by business elements, and products were discovered in storage while the shelves of shops were empty, the government launched the proposal of an Enabling Law.
This law gives the executive the power to enact whatever emergency laws he considers necessary to resolve the problems under discussion for a period of 12 months. President Maduro made the request, describing it as a law “for peace and economic prosperity.” (VTV) It is aimed at combating corruption and shortages. As required by the constitution, the law was approved by three-fifths of the deputies to the National Assembly on Nov. 19.
In a country where the opposition constantly tries to destroy the achievements and progress of the revolution, effective mechanisms are needed to defend it. The benefits of the Enabling Law, according to the Office of the Attorney General, are: it decreases the time needed to adopt new laws; it simplifies administrative procedures; it streamlines all necessary steps to respond to the emergency; it could establish special administrative procedures; and it provides a timely and effective response to those affected in priority areas. (correodelorinoco.gob.ve, Aug. 17)
How are the laws put into play?
Within the framework of the Enabling Law, President Maduro has approved the first two laws: For the Control of Costs, Prices, Profits and Protection of the Venezuelan Family; and the creation of the National Foreign Trade Center “to control currencies that are used for commercial activities for importation.” (Telesur, Nov. 21)
Part of the oligarchy’s speculation regarding prices has been importing products that are then sold at exorbitant prices, up to about 12 times their value. The government has been inspecting and intervening in stores, and in cases of overvaluation it has forced price reductions as required by the new law. This has unleashed a campaign by the right-wing accusing the government of hindering economic growth. The poor people, however, have reacted with satisfaction, thus nullifying any progress the right-wing could have made among this sector of the population.
The second bill exposes to a certain extent the level of difficulty of building socialism in the Bolivarian Republic. The creation of the National Foreign Trade Center reflects the lack of a centrally planned economy with a socialist base. In a country where there is still no dictatorship of the proletariat, and which is still based on capitalist relations of production, it is immensely difficult to ensure transparency of domestic and foreign trade.
The country’s economy is still based on oil, and although oil revenues have contributed to programs improving the quality of life of the Venezuelan people and increasing family income, much of those oil revenues, which are in U.S. dollars, go to private importers who receive currency subsidized by government currency (6.30 bolivars per dollar) to buy products on the overseas market to sell to the public. These entrepreneurs also use some of that currency to enrich the “parallel” or “illegal market” where they sell dollars on the street for increased value.
Maduro explains his actions
Because of the huge flight of capital in 2003, the Venezuelan government set up the Currencies Administration Commission (CADIVI) to regulate foreign exchange earnings. The government handed CADIVI dollars for it to sell. However, this has not resulted in the necessary transparency, and President Maduro has said he will investigate it to discover the fate of the dollars handed over by the government.
President Maduro explained what large businesspeople do to defraud the state: “If we provide them $50 million, what have they done? You know what they do? They set up an import company that receives the $50 million, then seizes and puts away $20 million and puts it in a foreign account, seizes and extracts $15 million and put it in the so-called parallel market for the phantom dollar, and extracts $15 million more to bring shoes to Venezuela.” (Telesur, Nov. 14)
Maduro continues: “We are proposing to build socialism in a sea of wild capitalism. … The foundations of socialism in economics have to be solid, productive forces based on new relations of production.”