Escaping the Legacy of Colonial Development in Venezuela

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The Venezuelan Series (Part 3):
Escaping the Legacy of Colonial Development in Venezuela

Wednesday, Sep 28, 2005

By: Richard Estes - American Leftist

For parts 1 & 2 of this series, see: Ciudad Guyana and "The New Working Class of Venezuela"

People familiar with the intense conflicts associated with the neoliberal globalization process may find this lengthy post tiresome, but it is not possible to properly understand the economic ambitions of the Bolivarian Revolution without recognizing the alternatives that it has rejected. Much has been written about the economic collapse of Venezuela since the oil boom of the 1970s, and the emergence of Chavez as conditions worsened. But it is also important to understand why the preservation of state control over the aluminum and oil industries, though CVG Alcasa, CVG Venalum and PDVSA, is a marked departure from the discredited form of global economic development implemented around the world by the United States, Japan and Western Europe.

Mexico, China and "Economic Processing Zones"

One need only look to Mexico for a plausible Venezuelan alter ego. Like much of Central and South America, it has traveled down a road similar to Venezuela's, but, unlike Venezuela, perhaps because of its close proximity to the United States, it has not abandoned the neoliberal model. In 1964, Mexico launched the maquiladora program, a program centered around the creation of facilities in the northern border regions to manufacture goods for export in return for foreign exchange, with the intention of relying upon braceros who could no longer work legally within the US. Participation of foreign investors in the Mexican economy expanded through the following decades as a result of an accumulated foreign debt that could not be serviced by a domestic economy that relied upon import substitution.

Mexico acknowledged the primacy of international finance capital over Mexican living standards through the implementation of NAFTA in 1994, an act that ignited the Zapatista revolt in Chiapas. According to Naomi Klein, citing figures provided by the WTO and the Maquila Solidarity Network, maquiladoras increased from 789 in 1985 to 3,509 in 1997, employing 900,000 workers. Corporations associated with Germany, Japan, South Korea and Taiwan invest in these facilities in addition ones identified as American.

As recently documented by David Bacon, in his compelling book, The Children of NAFTA, maquiladora workers toil under brutal conditions and live in appalling squalor, yet still seek to improve their lives through political action. More broadly, as in Venezuela, Mexicans have been forced out of agricultural and manufacturing work into "the unregulated informal economy", an economy in which people work under unpredictable, challenging conditions for low pay and no benefits, such as pensions and health insurance. Increasing social polarization and income inequality is almost universally acknowledged, with neoliberals meekly defending it as the necessary cost of "reform".

http://www.venezuelanalysis.com/articles.php?artno=1565