Sinking wells for potable water and irrigation is one of a number of public works and other social programs organized by PDVSA since the failure last year of the U.S.-backed employers’ lockout aimed at forcing out the government. The bosses’ “strike” crippled petroleum and natural gas production in December 2002 and January 2003, but was defeated by mass mobilizations of working people, including defiance by workers in the industry. One of the fruits of the workers’ victory in that class confrontation was a completely new management for PDVSA.

Leading up to the lockout, the administration of President Hugo Chávez had angered most of Venezuela’s wealthy ruling families and their allies in Washington by doubling the royalties investors have to pay for oil exploration contracts and taking other measures to strengthen state control of the country’s natural resources.

New PDVSA projects include piping natural gas to working-class neighborhoods that have had no access so far, supplying training and material help for the formation of peasant cooperatives, building affordable housing in workers’ districts, and providing support for government programs in areas around oil installations, including literacy classes and free neighborhood clinics operated by volunteer Cuban doctors.

In Anaco, a city near Campo Mata in Anzoátegui state, where the company’s eastern division is based, PDVSA has given particular prominence to the organization of unemployed workers into cooperatives of painters, electricians, truck drivers, seamstresses, and other occupations.

These measures are beginning to address some social needs. At the same time, some Venezuelans say, working people organized in the new cooperatives are already being mired in debt to banks and large businesses.

PDVSA has budgeted $1.7 billion for such projects in 2004, up from about $40 million in previous years.

These new policies have come under attack by the pro-imperialist opposition trying to oust the elected government. They have also generated debate among government supporters, some of whom argue that the company should stick to investing exclusively in oil exploration and production.  
 
Vast privileges for former managers
Venezuela nationalized its oil industry in 1975. When the operations of Royal Dutch/Shell and other foreign companies were made state property, however, the new company left the formerly imperialist-owned operations in the hands of the same bosses. Steps to bring the company under complete state control were not taken until the past two years.

With the largest known oil reserves in the Western Hemisphere, Venezuela is the fifth-largest oil producer in the world. Generating $46 billion in yearly sales, PDVSA provides 80 percent of Venezuela’s export revenue. More than 50 percent of exports go to the United States and Canada.

Most Venezuelans, more than 70 percent of whom live below the official poverty line, do not share in these riches. The privileges and wealth that oil executives and top administrative personnel enjoyed, on the other hand, explain why the company’s former management fiercely resisted the government’s policies in the industry prior to the lockout.

PDVSA’s president, for example, had a salary 10 times that of the minister of energy who was supposed to be his superior. According to the Ministry of Energy and Mines, the salary and benefit packages of the company’s top 20 executives ranged from $16,000 to $51,000 per month in 2002. In addition, many managers had access to PDVSA-provided chalets in the Andes. Top administrators enjoyed luxurious company-owned residences near their offices.

These bosses made sure that PDVSA—which owns Citgo’s U.S. refineries and 13,000 gas stations, and is the third-largest supplier of oil to the United States—was organized from the wellhead to the gas pump to serve the local bourgeoisie and their U.S. allies rather than the interests of working people in Venezuela.

When the Chávez administration began adopting measures impinging on these prerogatives, PDVSA’s management joined others in the capitalist class in efforts to topple the government—including the failed 2002 military coup and last year’s lockout. The measures in dispute included a hydrocarbons law enacted in the fall of 2001 that increased most production royalties payable by both PDVSA and international oil companies from 16 percent to 30 percent. The law also required PDVSA to own a majority stake in all joint ventures with foreign companies.

PDVSA had 32,000 employees nationwide before the “strike.” About one-third were administrators and managers, who overwhelmingly joined the boss action. In total, some 18,000 employees took part in the lockout and were subsequently fired—including the entire management.  
 
How workers defeated boss ‘strike’
During a March 22 visit to Cabimas, on the eastern shore of Lake Maracaibo, the heart of oil extraction, workers gave graphic descriptions to Militant reporters of the guerrilla warfare that took place as the outgoing management sabotaged computerized controls and other facilities and shut down operations in early December 2002, keeping them down for about two weeks. Cabimas is an hour east of Maracaibo, the capital of the state of Zulia, where more than half of the country’s oil is produced.

Denny Chirinos has worked for PDVSA for nine years. He told us that he was one of only eight workers from the 1,200 in the main shop repairing all drilling equipment and vessels used in the lake who stayed on the job during the lockout. “I led the eight,” he said. “We recruited another 22 skilled workers from the area within a day, and began the fight to restart production, including night patrols on the lake to protect the oil platforms. Throughout December, we had nighttime skirmishes with employees carrying out sabotage. By the end of the month we had won.”

So it wasn’t just administrative and managerial personnel who joined the “strike,” Chirinos explained. The bosses pressured or convinced most technicians and many maintenance and other production workers into joining them, he said, adding, “These are the best jobs in the country. Not only are the wages relatively high—starting at about $800 per month for full-time positions—but people had complete family medical coverage and subsidized food. Many aspired to become bosses and had that mentality.”

We heard similar accounts in Anzoátegui, second to Zulia in oil production and number one in the extraction of natural gas, according to PDVSA managers.

Carmen Bastarro is the receptionist at PDVSA’s new social development department in the city of Anaco. “A little more than a year ago, I worked for Petrolera,” she said in a March 24 interview, referring to a private company that lays pipe for PDVSA. “I was fired because I opposed the ‘strike.’ I also helped the Unemployed Committee in Anaco that had 400 members. When they shut down PDVSA in December 2002, most of us joined National Guard troops to defend oil tanks and help restart operations.”

Bastarro said a number of the oil workers in Anaco joined 1,200 steelworkers who came from Bolivar state to the south in January 2003 to repair a gas pipeline that had been sabotaged by supporters of the pro-imperialist opposition, stopping production at the country’s main steelworks in Ciudad Guyana. With the help of the National Guard, the steelworkers and their supporters succeeded in pushing back an armed demonstration of some 3,000 opponents and repaired the pipeline.

Bastarro said that before the defeat of the lockout she had “never dreamt” she would work for PDVSA. “These jobs were not open to us,” she said. “You had to know people high up to get in here.”

Today, most of PDVSA’s workers are newly hired. The workforce is younger and includes more Blacks, while company reports state that the percentage of administrative personnel has been reduced from one in three to one in five. The biggest cut took place with the closure of PDVSA’s main headquarters in Caracas, where thousands of administrative personnel were employed. The government has converted the building into the Bolivarian University.  
 
Visit to Anaco
Carlos Pereira, an agronomist, and attorney Lisbeth Romero work at the oil company’s department of social development in Anaco. Formed less than a year ago, the department is in charge of the social projects PDVSA is organizing in the eastern part of the country. These include programs to drill wells and pipe the water into rural communities. The department also provides six-month courses and legal and material help for the formation of cooperatives by peasants and others. New cooperatives in the area founded as a result of this initiative include about 100 service co-ops of painters, welders, and others, Romero said in a March 24 interview in her office. Some have already signed up for maintenance contracts with PDVSA, which provides them with as much as 40 percent of the contract fee up front to help them get started.

“PDVSA has donated tractors and other equipment to a number of peasant cooperatives,” Pereira said.

In a visit later that day to several rural communities near Anaco, it was clear that bringing water to these areas has helped undermine support for the pro-imperialist opposition, which dominates the state government and many town halls here.

“We organized protests for years and years demanding water we could drink,” said Gerardo Ramírez, a retired worker in Campo Mata. “All we got from the mayors was water tanked in a few times a week for drinking, washing, and everything else. And we had to pay for it at rising costs.” The latest price is 8,000 bolivars ($4) to fill a tank that lasts less than a week. “Now, when the water is piped in next month we’ll be able to start planting some of the fields around here for the first time,” Ramírez said. “Omar had a lot to do with this,” he added, referring to Omar Palma, an agronomist at PDVSA’s social development department in Anaco, in charge of the water project in these areas.

Palma showed Militant reporters three wells already drilled, and said another 15 will be sunk in the first half of this year.

Most of the 20 workers and peasants in the Calle Larga section of Campo Mata who spoke to Militant reporters said that with this accomplishment they feel they have a better chance of winning some of the other demands they have made. These include bringing school buses for their children, who now have to walk nearly two miles to their classes, repairing and upgrading the electricity grid that goes down several times a week, and bringing Cuban doctors to the area.

Just across the border from Anzoátegui, in Monagas state, is Crucero del Caro, home to about 700 people. Gregoria Castro, 23, one of the few high school graduates there, teaches a literacy class in the afternoons. “PDVSA has donated some tractors here and has helped clear land for cultivation,” she said. “But until the water is piped in, we have no chance.” Residents there expect that to happen within two months.

Most of the two dozen people Militant reporters interviewed in Crucero del Caro said they have been out of work for a long time. Widespread joblessness hits such rural communities particularly hard, since the dry climate and lack of irrigation mean that agriculture has taken up little of the slack as jobs outside PDVSA have been cut back.

Official unemployment in Venezuela reached 18 to 20 percent last year, when many jobs were lost in the aftermath of the lockout, and has stayed around that level.

The Coindustria research organization reported mid-March that the number of industrial firms fell to 4,900 in the fourth quarter of 2003, down from nearly 6,800 a year earlier. According to this study, Venezuela’s industrial sector had peaked at 11,600 firms at the end of 1997, the year before Chávez was elected president. Employment at Venezuela’s industrial enterprises stood at 260,000 in the fourth quarter of last year, a steep drop from 320,000 in the same period of 2002, Coindustria said.  
 
‘Cooperatives perspective’
The PDVSA agronomists in Anaco said the effort to form cooperatives is aimed at addressing this crisis.

Such efforts have spread to many areas of the country, including some where the oil company does not have major operations. During a March 17 visit to Valencia, the capital of Carabobo state and the country’s third-largest city, Militant reporters met Eduardo Tapia, who is organizing a community radio station in the patio of his apartment in the Monumental section of the city’s south side. We noticed an announcement pinned on the wall about a new cooperative by local residents called SURGAS-1.

“Twenty-five neighbors formed this co-op on the initiative of PDVSA a few months ago,” Tapia said. Its goal is to build the infrastructure needed to pipe natural gas into the area. PDVSA is providing the training, the pipe and other materials, as well as the labor, where needed. PDVSA Gas, a newly formed division of the oil company, will sell gas directly to the neighborhood co-op.

Tapia said that such programs were initiated in response to demands by working people to counter the power of capitalists allied with the Coordinadora Democrática opposition coalition, which effectively shut down gas supplies during the lockout. Most working people use propane for cooking, and are forced to buy it from companies aligned with the opposition.

PDVSA al día, the company’s newsletter, states that about 165,000 people will benefit from the gas-piping program.

PDVSA and government officials present the creation-of-cooperatives part of this initiative as the “democratization of the country’s economic resources.”

Some people, however, are questioning this perspective as a way to reverse the widespread poverty and joblessness. Joel Pantoja, a young doctor who accompanied Militant reporters in Valencia, for example, said that this course reinforces the mistaken notion that organizing workers into co-ops is the answer to confronting the economic power of the wealthy, that this can succeed without expropriating the capitalists and nationalizing the means of production.  
 
Rotating employment program
The company started a jobs program last December in Cabimas, where PDVSA’s western division is based and which has a certain autonomy from the eastern division. It’s called Plan Operativo Rotativo (POR), or the Rotating Operations Plan. Manuel Troconis, PDVSA’s maintenance manager there, told us March 22 that the government launched the initiative in response to demands for jobs.

PDVSA has taken on about 18,000 contract workers to replace those fired after the lockout. These workers are hired to permanent positions as they are qualified.

Under the POR plan, PDVSA has employed another 12,000 temporary workers nationwide, most of them in Zulia, working on rotation in three-month stints. They do painting and other routine maintenance jobs, as well as janitorial and transportation work. These workers are paid about $125 per week, more than double the minimum wage, and have individual medical coverage while on the job. When the contract is finished, they get severance pay of about $1,000—two months wages—and have to wait for three months for another three-month rotation. Most of these workers are in their early twenties, we were told.

Ricardo Aú, 20, worked such a janitorial job at PDVSA over the last two months. “These are temporary jobs, and we are not sure how long they will last,” he said in a March 22 interview in Maracaibo, in a typical comment among these workers. “But it’s better than anything thousands like me have had. Now we can feed our families.”

Workers said that in addition to providing jobs, the POR program is being used to improve routine maintenance neglected for years by the former management. This was part of a plan to begin selling off parts of the operations to foreign and local investors, workers said. They showed us four oil extraction platforms floating in the port by the main repair shop. These were rendered inoperable because of lack of maintenance, we were told. The bosses would then sign contracts with companies like Haliburton, Santa Fe Drilling, or local capitalists to provide drilling platforms and other equipment that would then be operated by private companies that would contract out repairs. At the same time, the main repair workshop in Cabimas was operated at 25 percent capacity in 2002, said Troconis. It now runs at 50 percent.

The maintenance manager said the company has now started a plan to utilize workers from the POR program. After a period of training, they will work on a night shift between 4:00 p.m. and 6:00 a.m.—the period during which the shop is now idle. They will take advantage of the unused capacity to produce equipment needed to improve living and working conditions in the surrounding area.

One of the repair shops nearby has just begun producing drills on the night shift to sink wells for irrigation. This was decided after the National Institute for Land stated that there is an acute need for water on thousands of acres around Lake Maracaibo where peasants recently got land titles and credits. PDVSA workers are now manufacturing new drills as well as refitting some old oil well drills to meet the need. The company will also assign engineers to work with peasants in making their land arable.

PDVSA has also assumed financial responsibility for the state’s largest public hospital, the University Hospital in Maracaibo, and taken over logistics for the Barrio Adentro program bringing Cuban doctors to Zulia, Troconis said.

Workers said, however, that some in the new management behave like the former executives. In more than one case, said Robinson Carteras, incompetence by administrators resulted in materials not being ordered on time, after which managers turned around and took it out on the workforce, firing temporary workers en masse before their contracts expired. Workers said that about 300 were fired March 21 in the main repair shop that employs 2,500. A union meeting had been scheduled for the next day to confront the problem, said Elbano Sánchez, the coordinator of the Cabimas local of Fedepetrol, the largest union of oil workers.

Many spoke with pride about one of the projects the maritime repair shop completed recently. PDVSA workers had built and donated a new motorboat—La lancha bolivariana—to a cooperative of fishermen nearby.

This initiative sparked a big debate, we were told, because the vessel was built by workers during regular work shifts, not by those on the POR program. Workers said they did not have enough work to do and it was better to use their time for something socially useful. Many in the new management argued vehemently against this, said Colina Gerwen, a welder. After getting Troconis’s support, he added, “We won this one. But it is a battle.”

Olivia Nelson and Natalie Doucet contributed to this article.  
 
 
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