The Next Great Transformation

From Capitalism to Socialism: The Revolutionary Process in Venezuela

by Quincy Saul, March 2009

“[E]s la marcha a fondo...” -Hugo Chavez Frias, 2006
“[T]he long term starts now...” -Raul Prebisch, 1983

In 1944, the Austrian scholar and activist Karl Polanyi published his famous and most influential book, The Great Transformation. In this book he attempted to chronicle and describe the transformation of the world by markets. Simply, Polanyi endeavored to describe the emergence of capitalism. Markets existed before capitalism, Polanyi argued, but always within a social framework that limited their size and prerogative. The emergence of capitalism, as Polanyi described it, entailed the subordination of all of these social frameworks to the rules of the market. What transpired was nothing less than the most consequential and explosive revolution in the history of the world. Even today, the great transformation continues. Capitalism continues to transform lives and landscapes on both massive and intimate scales in unprecedented, and perhaps irrevocable ways.

Capitalism, understood as the systematic organization of the world around market forces,has unleashed productive capacities on scales never before imagined. What we call the industrial revolution was a tributary of the larger revolution of capitalism, which overturned ancient societies and power structures in mere generations on every continent. By subordinating the social to the economic, the power to change and create was abundant as never before. But the astounding dynamism of this new way of life has come a price. Markets are amazing at creating wealth, but they do so indiscriminately. Markets on their own know neither restraint nor regret. In their insatiable need for new resources, both human and natural, markets take too much too fast, leading to widespread abuses resulting in both human crises and ecosystem collapses. And in their equally insatiable accumulation of profits, markets are again indiscriminate. In markets, money and power talks, and it is those few who have them that reap their benefits. Meanwhile, those who lack them are forced into ever greater poverty, subordination and exclusion. As Eduardo Galeano writes in the opening lines of his book The Open Veins of Latin America, “[t]he international division of labor consists of some countries who specialize in winning, and others in losing.” (p1) To summarize, capitalism creates breathtaking possibilities, and simultaneously prevents humanity from enjoying them in either a sustainable or a collective way.

From this realization has come the demand for the next great transformation. The social and environmental catastrophes that accompany the first great transformation are intolerable -- no progress could be worth such horrors. “The perpetuation of the current order of things,” writes Galeano, “is the perpetuation of crime”. (p11) The next great transformation would preserve the economic dynamism of the first great transformation, but bring it under the control of social priorities. This reconciliation of the social the economic, which recognizes the possibilities of the economic but which demands the primacy of the social, has been and is still today called socialism. Socialism would be a systematic (re)organization of human society around a harmony of the social and the economic. The transition from capitalism to socialism -- the next great transformation -- has not only been the subject of hundreds of books, but millions of people have lived and died for it, and many more are sure to make the ultimate sacrifice in its name. The scope of this essay will be necessarily humble -- I intend only to make some simple explanations and to raise a few significant ideas and questions about this next great transformation as it is taking place today, in the Bolivarian Republic of Venezuela.

In a speech in 2007, Venezuelan president Hugo Chavez Frias reflected on the difficulties of constructing socialism on the foundation of capitalism. “Men and women make history,” Chavez quoted Marx, “but only so far as history lets them.” In other words, the immense task of transforming an entire society is always shaped by the particular conditions of the already existing society. Socialism, after all, must be built somewhere, and that where is always already full of people with all their particular histories and relationships. Michael Lebowitz, in his book about socialism in Venezuela called Build It Now! writes that “[s]ocialism doesn’t drop from the sky. It is necessarily rooted in particular societies. And that is why reliance upon detailed universal models misleads us”. (p67) The first important point I would like to emphasize is that the next great transformation will necessarily be a greatly diverse transformation, specific to people and places. As any Venezuelan can tell you, it is a process, not a blueprint. However, this simple explanation may hide a great deal of contradiction and conflict that this process contains.

In 1908, in her book Reform or Revolution, Rosa Luxemburg published many interesting thoughts that are very relevant to the process of transformation in Venezuela. One “particularity of the capitalist order,” she wrote, “is that all the elements of the future society that exist in it initially assume a form that doesn’t bring us closer to socialism, but takes us farther away from it.” In other words, capitalist society contains in embryo many of the characteristics of socialism, but develops them in a way that makes the realization of socialism ever harder. For instance, the capitalist productive process increasingly brings people together to work. This move towards increasingly ‘social production’ has lead many to predict that capitalism will lead directly, if not perfectly smoothly, towards socialism. Luxemburg’s insight is that this transition is neither direct nor necessarily inevitable. Capitalism brings people together to work in factories, but it does so under conditions of alienation, exploitation and repression, while simultaneously spreading ideologies that legitimize and reinforce business as usual and the status quo, all of which actively prevents the emergence of socialism.

Luxemburg’s insight also has implications for that is known as ‘stage theory’. According to stage theory, the first great transformation must be complete before the next great transformation can be possible. Specifically, many stage theorists argue that only capitalism is capable of accumulating the productive forces from which socialism can be developed. In other words, socialism cannot be realized until capitalism is fully developed. Stage theories of this kind have been frequently rebutted on both moral and scientific grounds, but Luxemburg is particularly relevant here in that she predicts that the development of capitalism actually takes us ever farther way from socialism.

All of this raises many difficult questions about visions and strategies for the transition from socialism to capitalism. Capitalism continues to grow, the first great transformation continues, and more and more of our lives and our lands are every day put on the market. The breadth and resilience of capitalism has lead many to resign themselves to it, to settle for it, and to denounce the socialist process as impossible, naive, or “utopian”. But conversations with people in the barrios of Caracas, the capital city of Venezuela, can go a long way in challenging this kind of outlook. The historically oppressed poor are ever more empowered, politicized, educated and organized, not to mention healthy. Problems persist in great abundance, but Venezuela has made it clear that the next great transformation is not an impossible dream. On the contrary, writes Venezuelan Rafael Ramon Castellanos in his latest book,

we are seeing it in the new socialism for the 21st century in which are immersed not only Venezuelans but all people of thought in the universe who see the light of integration imposing itself on the horizon, while the goal-keepers of the empire vacillate and sow fear and terror everywhere. (p23)

The process is incomplete and in many ways fragile. Goal-keepers of empire wear many masks. The people of Venezuela know that the next great transformation will take many generations of struggle. And in many ways, this struggle is just beginning.

Venezuela is a capitalist country with a socialist government. Neither the declarations of a president nor improved education and health care are enough to transform a thoroughly entrenched economic and social system. While this is obvious to anyone living in Venezuela, international followers of simplistic leftist media may need to be reminded. Centuries of colonization and political dictatorship, along with many decades of subordination to foreign markets, cannot be transformed into democratic socialism in a few years. Big and easy profits from oil exports have created over the generations a small but very rich, powerful and developed political oligarchy and consumer society. Leftist Venezuelans will be the first to tell you that Venezuela is the most capitalist country in Latin America. There is even a hummer assembly line. In every sphere of state organization; legislative, judicial and executive, a lot of corruption persists. Meanwhile, “the bureaucratic monster,” as one Venezuelan described it to me, has only continued to grow. Another explained to me simply that “there are many rats, and only a few cats to eat them”.

Much of the persistence of these problems can be attributed to the particular form that the revolutionary process has taken until now in Venezuela. Since Chavez first publicly declared the revolutionary process to be a socialist one in 2004, he has been very careful to establish important qualifying conditions. The Venezuelan socialism of the 21st century is to be both democratic and peaceful. Moreover, Chavez has been explicit that the revolution does not intend to challenge private property. All of these conditions and the last one in particular, laudable though they may sound, have very vital consequences for the way that the revolutionary process develops.

Almost all socialist revolutions in world history have challenged private property, specifically private ownership of the means of production. In the strict sense of the terms, this has neither been a democratic nor peaceful procedure. Owners of the means of production are not given a voice in the process, and their property is taken by force. Instead of taking this traditional path, the revolutionary process in Venezuela until now has instead emphasized redistribution and democratization. Instead of promoting and sponsoring immediate takeovers of the means of production, Chavez and the United Socialist Party of Venezuela have advocated instead that workers be given a larger share of the profits and a louder voice in decisions that affect them.

In 1983, the Argentine economist Raul Prebisch wrote an article titled Five Steps of My Thoughts About Development, reflecting on the many decades of his work in government and international institutions as an economic advisor. Prebisch is worth quoting at length here, because he makes several ominous predictions that are quite relevant to the current course of the Venezuelan transition from capitalism to socialism:

Democratic processes have demonstrated a great efficacy in the improvement of real incomes and in the evolution of the state. But in the current system a limit exists that the power of redistribution can’t exceed, a limit that, once reached, puts the dynamic of the system in danger. When it arrives at this limit, surplus achieves its maximum level, and the privileged society of consumption can’t continue anymore like it could before the redistributive process that tends to improve the distribution of income... redistributive pressure will lead in this case to a crisis of the system. The democratic process tends to devour itself... I must lamentably conclude that, in the advanced course of peripheral development, the process of democratization tends to become incompatible with the regular functioning of the system. This is not due as much to the failure of this process, derived from the prevalent political immaturity in the periphery, but to the grave socioeconomic bias of the mechanism of distribution of income and accumulation of capital in favor of the upper social classes.

The revolutionary process in Venezuela is currently reaching the limit and undergoing the crises to which Prebisch referred 26 years ago. In recent years, the limit and the crisis have not been manifested in a giant cataclysm that shakes the entire society. Instead, it is a diffuse crisis, less visible than a generalized crisis but no less deadly. I will cite only two recent examples of how the democratic process is, as Prebisch predicted, devouring itself.

On January 12th of this year, workers at a Mitsubishi factory in the state of Anzoategui occupied a factory in protest of the company executives’ decision to not rehire 135 contract workers. 18 days into the occupation, on January 30th, three of the workers participating in the occupation, Javier Marcano, Pedro Suarez and Alexander Garcia, were shot dead by police. Six other workers and two police officers were wounded and taken to the hospital. Relevantly, Felix Martinez, general secretary of the union Singetram, said that the company is trying on a national level to convert into a “capitalist cooperative”. The precarious limit of this tenuous dual strategy of capitalist management and socialist organization is clearly defined by the events of January 30th.

More recently, on February 12th of this year, Nelson Lopez, a leader of the farmer organization Frente Campesino Jirajara, was murdered on his way home. He was shot 14 times in the back by hired assassins under the orders of Luis Gallo, a large landowner in the state of Yaracuy. Both of these examples reveal the limitations of the “peaceful and democratic” revolutionary process in Venezuela. As Prebisch warned, policies of democratization and redistribution, when they take place within a capitalist system, have definite limits. They become incompatible with the regular functioning of the system, and result in crises as the upper classes retaliate against the loss of their privileges.

I should be clear that my intention here is not in any way to condemn the revolutionary process in Venezuela. In a very brief amount of time (it has barely over four years since the socialist project was announced) the Chavez government has achieved immense progress in spite of powerful and organized domestic and international opposition. I merely offer a sympathetic analysis of the revolution, which has come a very long way, but which I fear in some important ways is reaching a structural limit imposed by the capitalist economic system which is still very much alive in Venezuela. It is an open question how much longer the revolutionary process can proceed without directly confronting capitalism on more than an ideological front, before the contradictions become an unbearable strain on society. “We know that the desire to develop a good society for people is not sufficient,” writes Lebowitz, “-- you have to be prepared to break with the logic of capital in order to build a better world”. (p72)

“[T]hose who choose the reformist path... don’t in reality elect a more tranquil path,” wrote Rosa Luxemburg. This has become undeniable in Venezuela today, proven by the deaths of Nelson Lopez and the factory workers in Anzoategui, among many others. The peaceful revolution, in the effort to avoid a large scale conflagration of violence, has necessarily invited a slower and smaller-scale but predictably extended and dispersed quantity of violence, as the old power structures attempt to defend their privileges against the new. As Luxemburg knew and Prebisch predicted, the path of reform, (in the Venezuelan case democratization and redistribution without challenging private ownership of the means of production) quickly reaches its limit. This limit is no secret to Chavez, who in the same speech warned that “[r]eformism can accompany a revolution for a time, but there is a barrier past which this reformism becomes counter-revolutionary”.

The persistent appeal of reform in spite of its known and predictable failures is nothing new. “Everyone wants to see new results without changes and changes without movements,” wrote Simon Bolivar. (quoted in Castellano, p38) Luxemburg is worth quoting at length. Reform and revolution may at certain times appear initially to to share the same path, but they are essentially at fundamental odds. The path of reform and reformers

is not one that moves slowly and surely towards the same objective... in place of creating a new society, they choose some insubstantial modifications of the old... they don’t seek the realization of socialism, but the reform of capitalism, they don’t seek the suppression of the system of salaried work, but the diminishing of exploitation. In summary, they don’t seek the suppression of capitalism, but the attenuation of its abuses.

As many revolutionaries all over the world have realized, reformers can become the most resilient and insidious obstacles in the way of revolutionary transformation. Again, this reality has not been missed by Chavez. “Beware of the reformist currents that fear a real revolution,” he reminded: “This is one of the greatest threats that we face, within, it is like cholesterol, some call it the silent assassin, it is the counter-revolutionary reformism, within ourselves”. Even self-declared enemies of empire can function as its gate-keepers. Many people who support the revolutionary process in Venezuela today are opposed to challenging private ownership of the means of production, in favor of the peaceful and democratic redistribution of profits. In response to the strategy and ideology of reform, there is perhaps no better response than something that I heard Subcommandante Marcos of the Zapatista Army of National Liberation say at a conference in 2007:

“Maybe some of you have seen those commercials that announce products that make you thinner without doing exercise... there is an advertisement for a cookie that will give you a spectacular figure, without doing more exercise than putting the product in your mouth and chewing it. In the same way... is the idea that one can transform social relations without struggling and without touching the privileges that the powerful enjoy.”

Private possession of the means of production is perhaps the core material essence of capitalism. Around this axis turns the accumulation of profits and power. Modifying the distribution of profits while leaving intact the concentration of power is the equivalent of one of Marcos’ diet cookies, that is at same time high in what Chavez characterized as counter-revolutionary cholesterol. Private control of capital is irreconcilable with socialism. As a factory worker’s slogan during the Russian revolution demanded, “The right to life is higher than the right to property!” It may be relevant that this slogan did not come from and was not approved by the Bolshevik party.1

Rising contradictions rock all boats. Chavez and revolutionary socialists all over Venezuela, along with capitalists and the historically privileged, are well aware of the struggle that awaits them. A socialist project which commits itself both to democratic and peaceful methods and to radical anti-capitalist ideology has never before been attempted, and the whole world is watching. How much longer and how much farther the revolution can advance without more directly challenging the powerful capitalist economic system that still dominates in Venezuela, and at what cost this delay will come, is very difficult to calculate. But we can be sure that these contradictions cannot be suffered forever. Chavez addressed this specifically in his 2007 speech:

[T]he internal situation is going to sharpen, in the coming months, more contradictions will arise, simply because we don’t have plans to detain the march of the revolution; on the contrary, it is a thorough march, and as the revolution goes deepening itself, expanding itself, these contradictions are going to flower, including some that, until now, have been covered up, they are going to sharpen, they are going to intensify, because we’re talking about economics, and there is nothing that hurts a capitalist more than their pocket, but we have to enter this theme, we cannot avoid it.

Whether Chavez has a plan up his sleeve, or whether he intends to wait for the ever more organized and empowered people to carry the revolution to its next stage on their own, we can only speculate. But the next great transformation cannot fully continue until the core material essence of capitalism is effectively challenged.

Meanwhile, capitalism continues to gestate and metabolize society, and if Luxemburg is right, the longer it takes to begin, the harder the transformation will be. Prebisch wisely alerted in his 1970 book Transformation and Development that “[t]ime doesn’t resolve problems on its own”. On the contrary, “it incessantly aggravates them”. (p152) Not only in Venezuela but in the entire world, all of these questions are of intense urgency. While “revolutions are not exported”, as revolutionaries from Che Guevara to Nora Castaneda have reminded us, we all have a lot to learn from a close analysis of the development of socialist revolution in Venezuela today.

The Bolivarian vision of international unity in resistance to capitalism is the most significant and promising advance for the next great transformation that the world has seen in generations. But no one in the world can simply sit back and watch. As Marcos wrote in one of his communiques, “there are no seats outside the ring”. We all have an important role to play in the next great transformation, and if we aren’t promoting it we are more than likely impeding it. “We need an international politics inspired in a long term vision of centers and peripheries,” wrote Prebisch, “But the long term starts now”.

Peaceful revolution is an appealing prospect, but perhaps a disingenuous dream. The price of postponing the inevitable conflict between the fundamentally opposed structures of capitalism and socialism is an intensifying climate of contradiction and hate where individuals and small organizations must face the brutality of reactionary power structures on their own. By preventing a nationally organized movement to advance the transformation to its next stage, the revolutionary state arguably puts its citizens at greater and more prolonged risk than if it were to lead the movement itself. While the social and ideological transformation in Venezuela continues to grow and expand in essential ways, the economic transformation for the moment has been stalemated. It is a very serious and grave matter, for which there will be no light answers. “I,” declared Josue de Castro, “who have received an international peace prize, think that, unhappily, there is no other solution than violence for Latin America.” (quoted by Galeano, p5)


1. History of the Russian Revolution, by Leon Trotsky, 1930 (vol.1 p419)


References:
(in order of appearance)
Las Venas Abiertas de America Latina, por Eduardo Galeano, 1971
El Discurso del Inicio de la Construccion del Partido Socialista Unido, por Hugo Chavez Frias, March 24, 2007
Build It Now! Socialism for the 21st Century, by Michael Lebowitz, 2006
Reform or Revolution, by Rosa Luxemburg, 1908 Referenced chapter: The Conquest of Political Power
Simon Rodriguez, Las Misiones, Y el Socialismo del Siglo XXI, por Rafael Ramon Castellanos, 2008
Cinco Etapas de Mi Pensamiento Sobre Desarollo, por Raul Prebisch, 1983
En Yaracuy, privados de libertad asesinos del dirigente campesino Nelson Lopez, por Frente Campesino Jirajara, March 1st, 2009: www.aporrea.org/ddhh/n129863.html
Two Factory Workers Killed During Factory Occupation in Venezuela, by Tamara Pearson, January 30th 2009: www.venezuelanalysis.com/news/4156
Transformacion y Desarollo, La Gran Tarea de la America Latina, por Raul Prebisch, 1970
Ni Centro Ni Periferia, por Subcommandante Insurgente Marcos, speech delivered at the International Colloquium on Anti-Systemic Movements, La Universidad de la Tierra, Chiapas, Mexico, December 2007. (Part One: La Geografia y el Calendario de la Teoria)
Creando Una Economia Solidaria, por Nora Castaneda

(all translations by Quincy Saul)

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