RACE, OIL, AND REVOLUTION IN VENEZUELA
by Ahmad B. Shanaa
Contributing Writer
Oftentimes, discussions regarding the root of the modern Venezuelan crisis begin with the rise of Hugo Chávez. However, the seeds of this conflict were sown in the sixteenth century when a group of Spanish colonizers first settled that fateful patch of northern South America. There they established the encomienda system wherein European masters put indigenous laborers – and later, African slaves – to work on large plantations specializing in the production of cacao.
This extractive institution enriched the landed aristocracy on the backs of the enslaved and laboring class, splitting their society into two distinct, racially-affiliated camps: white landowners and black or indigenous laborers. Understanding the nature of this division can provide key insights into the current crisis. Cacao production proved a lucrative enterprise, though little of the proceeds trickled past the upper echelons of society. Plantation profits were reinvested in expanding the encomienda system and protecting the status quo, while the country’s developmental institutions (e.g. public education) and lower classes were disregarded. This abusive cycle cemented an ethnopolitical dichotomy of interests in the population that still echoes into the present.
Venezuela as we know it was born in 1830, yet even after achieving independence, its people remained divided. The ethnopolitical class system outlived its colonial roots and while social dynamics shifted, the social hierarchy did not. Owing to a massive socioeconomic head start and governing institutions rigged in their favor, white Venezuelans dominated the country’s upper and middle classes while Mestizos (people of mixed African and indigenous descent) were relegated to the bottommost tiers of society.
In the 1920s, Venezuela discovered large reserves of oil which thereafter became the country’s economic cornerstone. Its profits were channeled into urban development and further enriched the upper classes while rural Mestizos were left behind yet again. This precedent of lower class exclusivism during periods of social prosperity continued through the 1970s, fomenting inter-class tensions. Public frustrations came to a head in 1989, when the neglected poor took to the streets of Caracas in a popular uprising dubbed “the Caracazo”.
While the uprising proved unsuccessful, it inspired a military officer by the name of Hugo Chávez to attempt a coup. Though Chávez failed, he became a national symbol of the marginalized masses in the process – a symbol so powerful that years later, after being released from prison, Chávez ran for president in 1998 and won. For the first time in Venezuela’s history, its leader was a Mestizo.
Chávez rode into power on a platform of anti-corruption and populism, drawing his support base from the lower classes. He aimed to dilute the residual colonial hierarchy and to economically converge the population. Thus, he became a natural enemy of the white upper classes, who largely possessed the excesses of wealth he sought to redistribute. His plan was simple: centralize control of the oil industry and redirect its revenues into social welfare programs for the poor. He hoped to leave behind the neoliberal, laissez-faire economic policies of his predecessors, which he and his constituents insisted served the upper classes by exacerbating wealth disparities. With every speech and policy, the white upper classes grew more and more disaffected, while his Mestizo base clung tighter to his leadership.
In 2002, a coup was orchestrated by several parties representing upper-class interests. But after crowds of Mestizo supporters came out in droves to protest the U.S.-approved deposition, Chávez quickly reclaimed his power and continued his campaign of social reforms. During his presidency, poverty levels were halved, income inequality was minimized, and the Mestizo majority saw their standards of living skyrocket.
The problem was, as Chávez continued to nationalize various industries in Venezuela, the country became dangerously reliant on oil revenues. It was a textbook case of what economists call “the Dutch disease.” As the oil sector had flourished and the value of the Venezuelan bolivar appreciated, it became progressively harder for domestic industries to compete internationally, leaving them weak and stagnant. The private sector had essentially been gutted, so when oil prices did drop, as happens regularly in the oil market, there was no one left to save the economy. Nevertheless, Chávez passed away just before the aftermath of his policies fully began to unfurl.
Prior to his passing, Chávez chose Nicolás Maduro, a former bus driver and unionist, to be his successor, bequeathing to him his Mestizo support base. Owing to Chávez’s economic shortsightedness and trends of large-scale capital flight, primarily carried out by the upper classes, Maduro also inherited an economy on the verge of implosion. Maduro’s vain attempts to curb the economic crisis only served to accelerate inflation. This, alongside crippling U.S.-imposed sanctions, made for especially bleak circumstances in Venezuela. As crowds demanded Maduro’s resignation, it became clear which demographic was leading the protests against Chávez’s heir.
One need only look at images of the demonstrators to see proof of this racial divide. Opposition leader Juan Guaidó is often seen walking alongside Venezuelans of a lighter complexion, whose free-market and privatization interests he champions. Meanwhile, many Mestizos continue to rally behind Maduro, despite his many missteps, for the simple fact that he acknowledges the exploitation and neglect they suffered for so long.
The truth is, the situation in Venezuela cannot merely be boiled down to the resource curse, or failed socialism, or the shortcomings of Maduro and Chávez. History has polarized the country into two groups whose interests are fundamentally unaligned; while one side begs for governmental support, the other demands nonintervention.
The only way Venezuelans can induce lasting change is by narrowing the social and economic gap between the two classes. So long as there is inequity, the Mestizo majority will not acquiesce, as Chávez showed they don’t have to. White Venezuelans must also acknowledge the historical ill-treatment of their Mestizo counterparts and work towards cultivating an atmosphere of trust, or both sides will continue to see each other as an ‘other’ to be overcome, as opposed to fellow Venezuelans.
But above all, healing will take time, and it should be noted that foreign intervention in support of one side will only serve to prolong and inflame this corrective process. Only after all of this is achieved can the country begin to bridge that gap and march forward as one people. Until that day, the long-standing class conflict in Venezuela will persist, as will the cycle of revolution.