Coup-making in Venezuela: the Bush and oil factors

As efforts to overthrow Venezuelan President Hugo Chávez intensify, two facts are inescapable: the power elite in the United States has never been happy with democratically-elected Chávez, but it took the Bush administration, with its corporate oil and energy connections, to turn up the heat against him.

Matters reached a boiling point with the April coup d’etat against Chávez, which lasted only two days as millions of Venezuelan poor rose up in his defense. Many of the details about the ousting of Chávez and his 48-hour replacement by corporate mogul Pedro Carmona Estanga have yet to be sleuthed out, but evidence implicating Bush and his cohorts has already accumulated.

The primary clues are Washington’s repeated criticisms of Chávez and its immediate virtual endorsement of Carmona by failing to condemn the coup. The backdrop is Venezuela’s status as the fourth largest oil-exporting country in the world, and the third largest source of U.S. oil imports.

U.S. complaints against Chávez, who was elected in record landslide votes in 1998 and 2000, include his Bolivarian reforms to “take from the rich and give to the poor;” his refusal to allow U.S. planes to fly over Venezuela for Washington’s war in Colombia; his opposition to the Free Trade Area of the Americas (FTAA); and his leadership in OPEC in working for a fairer deal for Venezuela and other oil-producing countries.

Also rankling the Bush administration, with its abundance of right-wing Cubans, is Chávez’s oil sales to Cuba in exchange for medical care.

About half of Venezuela’s revenues come from state-owned Petróleos de Venezuela, S.A. (PDVSA). Providing more for the country’s millions of poor necessarily means maximizing the gains from oil, so Chávez sought to stanch the hemorrhaging of profits out of Venezuela into the coffers of banks and corporations largely based in the north. This entailed altering the 60-year-old agreement with foreign oil companies that charged them as little as one percent in royalties, and handed them huge tax breaks. But the giant transnational oil corporations and business interests had different plans.

“Opposition business leaders have said openly that they want to depose Chávez so they can boost oil production or even privatize the country’s cash cow [PDVSA]. … [T]hey have been enraged … over Chávez’s efforts to take resources from the rich to aid the poor, who represent 80 percent of the population,” Letta Tayler wrote in Newsday April 24.

During Carmona’s 48 hours in power, he moved instantaneously to reverse Chávez’s Bolivarian policies and consolidate what amounts to an “oiligarchy.” He dissolved the parliament and the supreme court, dismissed all mayors and governors, stopped the shipment of oil to Cuba, and started a wave of repression across the country.

The goal: privatization of Venezuela’s oil

A May 1 article in Mexico’s Proceso says one of the aims of the coup leaders was “the privatization of PDVSA, turning it over to a U.S. company linked to President George Bush and the Spanish company Repsol; plus the sale of CITGO, the U.S. subsidiary of PDVSA, to Gustavo Cisneros and his partners in the north, as well as an end to the Venezuelan government’s exclusive subsoil rights.”

Cisneros, a longtime friend of former President George Bush, heads up a corporate empire stretching from the U.S. to Patagonia, the British Economist reports.

PDVSA is Latin America’s largest company – a lucrative prize awaiting the eager fingers of the privatizers. The maneuvers to achieve privatization of PDVSA began in earnest after Chávez became president. Though we are told that it was the workers who reacted against Chávez’s changes, a March 2001 Wall Street Journal article disclosed a different picture, speaking of “top management and white-collar workers” at PDVSA “in open revolt against the government of President Hugo Chávez.”

The WSJ reported: “[T]hey have participated in … noisy demonstrations and work stoppages to protest the recent appointment of three Chávez loyalists to PDVSA’s board. … Leaders of a newly organized PDVSA ‘management union’ aren’t saying when or if they would strike. However, after holding a companywide meeting last weekend, they announced plans to carry out a series of gradual escalations of the conflict that could culminate in an indefinite strike … The controversy quickly exploded when thousands of PDVSA executives signed full-page newspaper ads denouncing the new appointees as ‘incompetent.’“ On April 4, 2002, “PDVSA executives declared a work stoppage,” the WSJ reported. In the lexicon of U.S. labor, these “strike” actions would be considered “lockouts” by management.

The leadership of the oil workers union, which operated in close alliance with the two political parties that ran Venezuela for 40 years before Chávez, also became involved. And information continues to surface about the role played by the Confederation of Venezuelan Workers (CTV) leadership, especially its president, Carlos Ortega, in the coup attempt and his ongoing role in efforts to bring down Chávez. Tayler notes that former Venezuelan president Carlos Andres Perez, currently living in Miami, who is wanted on corruption charges in Venezuela and has been accused of involvement in the plot, is a mentor of both Ortega and Carmona.

The WSJ says conflict between top PDVSA administrators and Chávez had been building since Chávez pushed through a law doubling most production royalties on both PDVSA and international oil companies. The law also requires PDVSA to own a majority stake in all joint ventures with foreign companies. Chávez appointed a new PDVSA president, economist Gastón Parra, who was attacked by critics, the WSJ says, as “a 1960s-era big-government leftist, dispatched to PDVSA on a mission to tie the company more closely to the state.”

The previous PDVSA president is quoted as saying the company had been “efficiently run as a profit-making company that pays dividends to its shareholder, the state. It shouldn’t be delegated to the inferior status of being a mere appendage of the oil ministry, subject to the president’s interference.” But the state is not merely a “shareholder” and PDVSA is not a “mere appendage of the oil ministry.” PDVSA is owned by Venezuela, not a fiefdom of board members appointed by the previous corrupt Venezuelan oligarchy. Clearly the oil ministry has jurisdiction over the government-owned enterprise. The government has every right to appoint the board members and to “tie the company more closely to the state.”

The New York Times reported April 24, “When Venezuela nationalized its oil industry in the 1970’s, the management at the local operations of Royal Dutch/Shell and other foreign companies that eventually became Petroleos de Venezuela remained.” Chávez endeavored to wrest control of the company from these former oil company executives, who had engendered popular revulsion for corruption and high living.

Bush administration’s role

Last fall, “a stream of prominent Venezuelans opposed to Chávez’s populism…began visiting U.S. officials…to float ideas about his ouster,” Tayler reported. “In some meetings, including one this year at the U.S. Embassy that was attended by Pedro Carmona … a coup was specifically proposed, participants in those talks said… Some Chávez opponents left the meetings believing that ‘all the United States really cared about was that it was done neatly, with a resignation letter or something to show for it,’ said a Venezuelan source familiar with some of the discussions.”

Further, Tayler wrote, “pro-Chávez Venezuelan officials have said two members of the U.S. Embassy’s military attachés were briefly inside the coup-makers’ military headquarters at Fort Tiuna on April 13 … One of the U.S. officers held an hour-long closed-door meeting with Gen. Efrain Vasquez Velasco, the army commander, one Venezuelan official said.”

Bush appointees dealing with this region got their start in the dirty wars under President Reagan. One of them, Elliot Abrams, who was convicted for misleading Congress over the infamous Iran-Contra affair, is Senior Director of the National Security Council for “democracy, human rights and international operations.” He is a leading theoretician of “hemispherism,” which seeks to counter Marxism in the Americas, spawning the 1973 Chile coup and backing death squads in Argentina, El Salvador and elsewhere. Abrams “gave the nod for the coup” in Venezuela, the Observer reported.

Another key player is Assistant Secretary of State for Latin America Otto Reich, a right-wing Cuban exile and former Mobil Oil lobbyist, who was Reagan’s ambassador to Venezuela. Reich received Venezuelan coup plotters, including Carmona, at the White House, the Observer said. In these meetings, “the coup was discussed … right down to its timing and chances of success,” the Observer reported.

The London Guardian reported that American military attachés were in touch with members of the Venezuelan military in June 2001 to examine the possibility of a coup. It quoted a former naval and National Security Agency intelligence officer as saying that U.S. Navy ships “provided signals intelligence and communications jamming support” to Venezuelan military personnel participating in the coup.

“The perfect crime”

Since the aborted coup, the campaign to topple Chavez has been redoubled. Le Monde diplomatique described the likely scenario for overthrowing Chavez:

“[T]here will be a coalition of the well-to-do, bringing together the Catholic Church …, the financial oligarchy, the employers’ organizations, the bourgeoisie and corrupt trade union leaderships – all repackaged as ‘civil society.’ The owners of major media will collude … to support the campaigns that they will each launch against the president, in the name of defending that ‘civil society.’…

“The press and TV will brandish terms ‘the people, democracy, liberty,’ etc. They will mobilize street demonstrations and any attempt by the government to criticize them will be immediately described as ‘a serious assault on freedom of expression,’ … they will revive the insurrectional strike and encourage ideas of a coup and an assault on the presidential palace. …

“The Venezuelan media currently uses lies and disinformation in the biggest ever destabilization campaign against a democratically elected government. Since the world hardly seems to care, the media hopes that this time it will succeed in committing the perfect crime.”

Seeing the disturbing similarities to the 1973 U.S.-instigated Chilean coup – which occurred after one failed coup attempt – the majority of Venezuelan people are remaining vigilant about further moves to oust Chávez. The people of the United States have the responsibility and the possibility to put an end to the Bush administration’s anti-democratic covert operations and military interventions in Venezuela.

The author can be reached at icpj@igc.org