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Subject: Fwd: [toeslist] Is Venezuela Heading Towards Prout?
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From: Trent Schroyer
Date: Mon, 12 Mar 2007 13:29:43 -0700 (PDT)
Subject: [toeslist] Is Venezuela Heading Towards Prout?
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Web Pages:
<http://www.ve.prout.org>www.ve.prout.org
<http://www.prout.org>www.prout.org
<http://www.proutworld.org>www.proutworld.org
--~--~---------~--~----~-
Is Venezuela Heading Towards Prout?
3 December 2006
Is Venezuela Heading Towards Prout?
by Andy Malinalco
Today there are countless movements and struggles which are fighting
for the
creation of a more just, sustainable, and human society, guaranteeing
safety
and individual freedom. Of all these, many progressive people around
the
world see the Bolivarian Revolution in Venezuela as the one with the
greatest possibility to transform social reality.
Prout (Progressive Utilization Theory) is a socio-economic theory with
a
holistic purpose which seeks to replace capitalism with the three-tier
model. The three-tier model is one in which cooperatives are the main
economic enterprise in the society, with large-scale key resources
being run
by local government enterprises and small-scale business matters being
privately owned. However, cooperatives would be with pre-dominant
type of
enterprise and the more cooperatives the better. There may also be
scope
for aspects of key industries, as well as small business, to become
cooperatized as well.
PROUT was conceived in 1959 by the Indian philosopher and spiritual
leader
Prabhat Ranjan Sarkar (1921-1990). Prout is not a rigid economic
doctrine,
like the neoliberal regime, but a collection of principles which can
be
applied according to the requirements of any given situation. It's a
model
which - instead of economic growth as an end in itself - through
economic
democracy, decentralization, participatory management, regional
autonomy and
self-sufficiency has the well-being of all living being as the guiding
principle of social and economic life. That is, there is a neo-
humanistic
welfare orientation.
While the Bolivarian Revolution proceeds mostly through trial and
errors,
Prout is a theoretically sound and worked out coherent vision, which
until
now has only been put into practice by a few small local communities
in
various countries. In this article compares how the main goals of the
Bolivarian Process point toward the vision of Prout.
The path originates through various conflicts
The Bolivarian Revolution which was started with the electoral victory
of
Hugo Chavez in 1998, is not working with a rigid doctrine, and like
most of
the current movements standing against the neoliberal world order
(e.g. the
Zapatistas, People's Global Action, Reclaim the Streets, etc.) is not
really
defined. Its shape is drawn by the constant clashes with its national
and
international opposition, and it is these very conflicts that in turn
lead
to formulation of cohesion in its outlooks (thesis - antithesis ->
synthesis
[thesis]), not some incohesive doctrine, which make it more and more
radical.
For example, during the first years Chavez - besides his determined
anti-imperialism - spoke about some 'third way' and 'capitalism with a
human
face'. Now he has changed this for anti-capitalist rhetoric, and since
the
beginning of 2005 he is propagating 'Socialism of the 21st Century' as
the
direction for Venezuela - although he has not clearly defined what he
means
by this.
According to Michael Lebowitz (1), the original blueprint of the
Chavez
government was a strong State rejecting neoliberalism and controlling
the
key industries; supporting the formation of cooperatives, with the
informal
sector becoming a part of the legal economy; while the backbone and
driving
force of the economy remains private capital and large capitalist
corporations. This concept changed due to the impact of the coup, the
illegal oil strike and the self-organization of the people in
resistance to
these two attempts to bring down the government. The focus shifted to
an
anti-capitalist direction, with the alternative of solidarity economy.
Every attempt by the opposition to get rid of Chavez has instead
strengthened his control and opened new gates for revolutionary
change. The
attempted coup in 2002 not only led to the cleanup of the military
command,
but it made it clear to the poor supporters of Chavez that if they
want to
keep their revolution, then their activity, participation and
organized acts
are very much needed. The coup attempt turned out to be the most
efficient
mobilization of the Chavistas. In the general strike it was realised
that
company owners were aligned with the opposition at the end of 2002,
and at
the beginning of 2003 what was made possible was examples of workers'
management in practice, with more government control of the national
oil
company PDVSA (2). Since then PDVSA's profits are funding the
government's
popular 'missions', which were started in 2003. The food crisis
experienced
during the days of the strike created the realization that
safeguarding the
nation's food security was vital. Due to the food crisis, the military
opened shops on the main roads of Caracas, selling basic foods under
its
market price. These turned out to be so popular, that after the crisis
ended, a chain of such stores was broadened to the whole country,
within the
framework of Mission Mercal.
Prout principles in the Bolivarian Revolution
So while the Bolivarian Revolution doesn't have a coherent and
detailed
vision about the future society, its goals, which caused it to turn
its back
to capitalism, correspond to some of the goals of Prout: to minimize
inequality, achieve national self-reliance, and create economic
democracy,
where everyone is able to satisfy their basic necessities.
The Bolivarian Revolution has started to apply principles of Prout,
for the
most part unconsciously, in the following four areas: securing the
basic
necessities of people, economic independence and self-sufficiency
(endogenous development), building an alternative economic model based
on
cooperatives as the mainstay, and creating participatory management in
economic affairs. These are underlying neo-humanistic and universal
ideals
inherent in the ethical development of society for the good and
happiness of
all, and so naturally any progressive and welfare oriented movement
would
imbibe them.
1. Providing the basic needs
According to Prout it should be guaranteed that everyone is able to
afford
their basic necessities. The five basic necessities are: food and
drinking
water, clothing, housing, education and health care. These are needed
for a
quality of life that is necessary in order to start the development of
the
real human personality, which has the capacity to make decisions
regarding
their economic future and social participatory role. As Dada
Maheshvarananda
wrote, paraphrasing P R Sarkar: "Providing the basic necessities
should be
the primary function and duty of any economy. Human beings require
these in
order to realize their individual potentialities, to develop
culturally, to
achieve inner fulfilment and self-realization, which many now consider
as
higher goals of life.. What a wonderful world it will be when no one
on the
planet will worry about getting enough money to buy the food, clothes,
housing, education and medical care needed for his or her family!" (3)
Of these five necessities, the following appear in the Bolivarian
Constitution of 1999 as basic rights:
* proper housing in Article 82: "Every person has the right to
adequate,
safe and comfortable, hygienic housing, with appropriate essential
basic
services, including a habitat such as to humanize family,
neighbourhood and
community relations. The progressive meeting of this requirement is
the
shared responsibility of citizens and the State in all areas."
* education free of charge in Article 102: "Education is a human right
and a
fundamental social duty; it is democratic, free of charge and
obligatory."
* primary health care in Article 83: "Health is a fundamental social
right
and the responsibility of the State, which shall guarantee it as part
of the
right to life. The State shall promote and develop policies oriented
toward
improving the quality of life, common welfare and access to services."
* universal access to health care in Article 84: "In order to
guarantee the
right to health, the State creates, exercises guidance over and
administers
a national public health system that crosses sector boundaries, and is
decentralized and participatory in nature, integrated with the social
security system and governed by the principles of gratuity,
universality,
completeness, fairness, social integration and solidarity."
The State started the 'missions' with the goal of securing these
constitutional basic rights and creating essential social security.
For example, within the framework of Mission Habitat the government
builds
new residential buildings - primarily for families with children and
without
a home, and for communities that organized themselves into
construction
teams. Housing is a serious problem in Venezuela: a large part of the
population lives in hardly lashed-together shanties or in badly
constructed
buildings without plaster.
The Mission Barrio Adentro - which is maybe the most famous project in
international terms - was started in the spring of 2003, and brings
basic
health care into the slums, to that huge part of society that were
previously excluded from health care. Both consultations and medicines
are
given free of charge. The doctors and staff live in the slums to
really
serve the community. With this 'mission', which costs up to 5 billion
dollars a year, presently 14,000 doctors and 3,000 dentists from Cuba
and an
increasing number of Venezuelan doctors provide health care to some 17
million Venezuelans.
The educational 'missions' were started against exclusion and to
foster
participatory management in the education sector - illiteracy and the
lack
of learning possibilities were the main factors that sustained the
enormous
social differences. The goal of Mission Robinson was to end
illiteracy. When
it started in July 2003, one and a half million people, which means 6%
of
the population, were illiterate. On 28 October 2005 Venezuela was
declared
an illiteracy-free country. After Mission Robinson the government
launched
Mission Robinson II for those who didn't finish primary school - the
program
includes more than one and a half million adults. Until September 2006
some
418,253 adults who previously dropped out finished their high school
studies
within Mission Ribas. The State pays approximately 100 dollars each
month
(which in Venezuela is quite useful) to every participant of the
educational
programs so that they can attend these courses.
Mission Mercal, the nutrition project of the government, sells basic
foods
in poor areas at 28-40% less than the market price. In the first wave
in
2004, they established 4,052 such shops, and this number increased to
15,721
by September 2006. The Mercals sell nearly half of the total food sold
in
the country. In addition, free canteens appeared in the slums, named
Comedores Bolivarianos, which provide hot meals to 600,000 people
every day.
This is people's economy in action and helps redefine and shape the
market
to meet the basic necessities of the population.
People's economy is an aspect of Prout. P R Sarkar describes it as
follows:
"People's economy deals with the essential needs of the people in
general - the production, distribution, marketing, shipping, storage,
pricing, sales, freight charges, pro forma costing, and all related
activities of such essential needs. Most importantly, it is directly
concerned with the guaranteed provision of minimum requirements such
as
food, clothing, housing, medical treatment, education, transportation,
energy and irrigation water. Continuous improvement in and ready
availability of these requirements is the key factor in people's
economy.
The minimum requirements can be assured through guaranteed
purchasing capacity which should be enshrined in the constitution as a
fundamental or cardinal human right. This will give the citizens of
the
country legal power if their minimum requirements are not met, hence
the
necessity of purchasing capacity will be reinforced by constitutional
law.
As people's economy will deal with minimum requirements and people's
subsistence problems, it must take precedence over other parts of the
economy.
People's economy should also be concerned with the development of
both private and cooperative industries. Private industries would be
limited
in size and scope to prevent monopoly production and exploitation, and
would
be required to function as cooperatives once they grow too large.
Cooperative industries are the best means of independently organizing
people
so that they take collective responsibility for their livelihood.
People's economy also includes employment for all; the eradication
of mass poverty; the development of rural economy; the phase-wise
socialization of land into the hands of those who work physically or
intellectually for proper production; practical training programmes to
impart skills which enable people to find employment in their
immediate
urban or rural locality; work placement; and the transportation,
transshipment, loading and unloading of any materials, even if they
are not
economically viable in the short-term. It is also concerned with the
generation of cheap power and the supply of water, which are essential
if
people are to control their local economies. Finally, it includes
economic
decentralization, cooperative dynamo and block-level planning."
From: QUADRI-DIMENSIONAL ECONOMY
5 June 1986, Calcutta
2. Endogenous development
Prout proposes that the current centralized economy be decentralized
into
economically self-reliant regions. While forming socio-economic units,
several factors should be considered. These include: same economic
problems; uniform economic potentialities; ethnic similarities; the
sentimental legacy of the people; and similar geographical features.
These
regions would also place importance on the inhabitants' cultural
legacy and
nurturing of local language to help solve social and economic problems
and
development social and economic interests. These regions would decide
their
economic future from below, with planning emerging from the
communities.
Such regions would be divided into blocks, which would provide the
basic
level of economic planning. As P R Sarkar wrote:
"There are many benefits to block-level planning. The area of
planning is small enough for the planners to understand all the
problems of
the area; local leadership will be able to solve the problems
according to
local priorities; planning will be more practical and effective and
will
give quick, positive results."
From: BLOCK-LEVEL PLANNING
1981, Calcutta
With the term "endogenous development", Chavez marks his endeavour to
reject
the neoliberal economic rules and the developed countries economic
models.
Instead he is trying to develop an economic model which suits
Venezuela, is
for Venezuela, and satisfies the needs of Venezuela. This model is not
well-defined, as are so many other things in the Bolivarian Revolution
-
instead the revolution itself forms it with the process. The goal is
to
create the nation's economic sovereignty. According to Chavez, while
in the
time of Bolivar the fight was for political independence, this
generation
should achieve economic independence (4).
In concrete terms this means to break the dependence on oil, to
diversify
the income sources of the national economy, and to rejuvenate
agriculture
which withered after the discovery of oil, and to achieve food
security.
(Venezuela imports the majority of the food it consumes, although they
have
succeeded to reduce this rate from 72% in 1998 to 64% in 2006.) Five
fronts
have been defined for endogenous development: agriculture, industry,
infrastructure, tourism and services.
Strengthening agriculture is a crucial factor in achieving economic
independence. The goal of food security is in the constitution, as
follows:
* food supply in Article 305: "A secure food supply must be achieved
by
developing and prioritizing internal agricultural and livestock
production."
* support of rural development by the State in Article 306: "The State
shall
promote conditions for overall rural development, for the purpose of
generating employment and ensuring the rural population an adequate
level of
well-being, as well as their inclusion in national development."
Ultimately, the agricultural sector should be well industrialised and
run on
a cooperative basis. This will meet the needs of the local people. P
R
Sarkar defines 'local people' as:
"Local people are defined as those who have merged individual
socio-economic interests with the socio-economic interests of the
socio-economic unit they live in. The primary consideration is whether
or
not people have merged their individual interests with their socio-
economic
unit, regardless of their colour, creed, race, mother tongue,
birthplace,
etc.
From: SOCIO-ECONOMIC MOVEMENTS
31 December 1984, Calcutta
3. Cooperatives
Prout proposes a dynamic economy of the people, by the people and for
the
people. Rejecting profit-making as the goal of the economy, Prout
bases its
economic policy on consumption; that is, on meeting the actual needs
of
people (5). Prout proposes a three-tiered economic system to realize
this.
To preserve the open, innovative spirit of entrepreneurial outlook,
but to
avoid the destructive and exploitative impact of capitalism (which
overrides
the local social and economic environment), Prout keeps the private
enterprises on a small-scale size, and sets a ceiling for the maximum
growth
of a private business, which should then adopt cooperative principles.
The largest part of the economy is formed by the cooperatives. This
guarantees economic democracy, the decrease of alienation, the more
just
distribution of wealth, and it makes possible changing the logic of
profit
to satisfying the real necessities and achieving everyone's well-
being.
Those industries which have strategic importance and which are too big
or
too complex to be efficiently managed by a cooperative, for example
primary
energy sources are the key industries which are managed by local
government
enterprises. However, there may be many secondary cooperatives that
may
also be producers or suppliers in the processing area.
The Bolivarian Revolution from its beginning committed itself to
keeping the
key industries state-owned - rejecting the neoliberal doctrine
demanding
privatization. Accordingly, the new constitution provides:
* public interest element in Article 302: "The State reserves to
itself,
through the pertinent organic law, and for reasons of national
expediency,
the petroleum industry and other industries, operations and goods and
services which are in the public interest and of a strategic nature."
Prout proposes that key industries be run on the principle of
"no-profit-no-loss". As these enterprises are not privately owned,
surplus
income will not be paid out as dividends to stockholders or private
investors (5). Rather, everyone may benefit by way of a rebate in the
cost
of goods or services. Or by spending the state-owned enterprises'
profits
in social 'missions', the government realizes this principle of Prout
by
giving it to the most poor of the society.
When Chavez took power in 1998 there were only 762 cooperatives in the
country. One of the most important aims of the Bolivarian Revolution
has
been to make this barely existing sector an important part of the
economy.
The Bolivarian Constitution asserts that the State should promote and
protect cooperatives as a popular economic alternative:
* cooperatives in Article 118: "The right of workers and the community
to
develop associations of social and participative nature such as
cooperatives, saving funds, mutual funds and other forms of
association is
recognized. The State shall promote and protect these associations
destined
to improve the popular economic alternative".
* guarantee of training, technical assistance and financing in Article
308:
"The State shall protect and promote small and medium-sized
manufacturers,
cooperatives, saving funds, family owned business, small business and
any
other form of community association for purposes of work, savings and
consumption, under an arrangement of collective ownership, to
strengthen the
country's economic development, based on the initiative of the people.
Training, technical assistance and appropriate financing shall be
guaranteed."
However no significant change took place until 2001, when the number
of
cooperatives was about one thousand. But with the impact of the
passage of
the Special Law on Cooperative Associations in that year and the bank
loans
provided by the Ministry of Popular Economy (MINEP) since 2003, their
number
has dramatically increased. More than 150,000 co-ops have been
registered in
Venezuela by 2006, the largest number in the world.
To encourage and strengthen cooperatives and to create a base for
endogenous
development, in January 2004 the government launched Mission Vuelvan
Caras,
a one-year-long training program. The participants, who usually come
from
other educational missions, receive practical job training, and after
finishing the majority form cooperatives.
In regard to cooperatives P R Sarkar states:
"Besides agricultural or farmers cooperatives, PROUT advocates the
formation of other types of cooperatives, including producers and
consumers
cooperatives. Producers cooperatives include agro-industries,
agrico-industries and non-agricultural industries. The total profit of
such
cooperatives should be distributed among the workers and members of
the
cooperative according to their individual capital investment in the
cooperative and the service they render to the production and
management of
the cooperative.
Similarly, consumers cooperatives should be formed by like-minded
persons who will share the profits of the cooperative according to
their
individual labour and capital investment. Those who are engaged in the
management of such cooperatives will also be entitled to draw salaries
on
the basis of the services they render to the cooperative. Consumers
cooperatives will distribute consumer goods to members of society at
reasonable rates."
COOPERATIVES
18 February 1988, Calcutta
4. Participatory democracy
One of the most important achievements of the Chavez regime has been
the
inclusion of people into the political decision-making process. It
began
with the writing of the new constitution based on broad consensus in
1999. A
national referendum was held whether there should be a new
constitution,
then there was an election for the constitutional assembly. The
writing of
the constitution included wide-ranging consultation, and then the
final text
went to another national referendum for acceptance.
Since then Chavez has constantly called on the people to take power -
which
sounds somehow funny when the Bolivarian Revolution is based on a
charismatic leader. But heeding his call, local government and the
people
started closer collaboration. Citizens form committees, express their
opinion about the budget, which tasks must be done, etc. Another part
of the
process is the formulation of new communal councils (based upon
200-400
families in cities and 20-50 in rural areas), which chip on the local
affairs - and they flourish in both the slums of Caracas as well as in
the
high-class district Altamira.
This model requires much grassroots activity from the citizens;
although
currently participation is surprisingly strong, sceptics warn that the
same
ardour could be seen in the first days of the Iranian, Cuban or
Spanish
Revolutions, only to have it later disappear.
In contrast, Prout focuses more on making representational democracy
more
accountable, while the participation of the people in decision making,
anticipating the ebbs and flows of enthusiasm, would happen primarily
according to their economic interests through cooperatives and
determining
their community's economic future.
The seeds of this transformation have also appeared in Venezuela.
Workers
encouraged by Chavez occupied approximately 1,200 factories and other
businesses after the owners decided to close them. In the days of the
general strike in 2002, workers locked out by their bosses in many
places
broke into their very workplace and were able to run it without the
management. In certain state-owned enterprises, worker co-management
also
appeared, such as in the Alcasa aluminium company, where the workers
are
able to freely elect their own managers and can participate in the
decision
making. However these cases are still exceptions even in the state-
owned
sector, and more like experiments that generate great expectations,
rather
than part of a broad realignment.
Perspectives
What's taking place in Venezuela, in spite of the term 'revolution'
used by
the Chavistas, is a slow rearrangement of resources and the opening of
new
spaces for economic and political participation. At the beginning of
the
Bolivarian Revolution, 42.8% of the households lived under the poverty
line.
By the second half of 2005 this rate decreased to 37.9%. This numbers
were
calculated by Venezuela's National Statistics Institute on cash
incomes,
therefore don't show the effect of the 'missions' which increased the
general quality of life of the poor. But of all this the achievements
the
Venezuelan society is still marked by the presence of wide-spread
poverty
and shocking inequality.
In spite of the cooperative boom, only 6% of the Venezuelan labour
force
works in cooperatives. Moreover some of the new cooperatives are not
active,
and some were established just to get the government's bank loan -
their
economic viability is still to be proven. This, and the shortage of
cooperative experience in the country, indicates that cooperatives are
still
far from taking over the Venezuelan economy. Instead of watching the
creation of a 'Socialism of the 21st Century' or the economic
democracy of
Prout, what we are seeing so far is more like an experimental
laboratory of
an alternative economic system.
Furthermore the capitalist structures haven't been touched in
Venezuela.
Chavez, contrary to his Cuban friend Fidel Castro, has not taken
anything
away from the bourgeois, and Venezuela is still a capitalist country -
although not neoliberal. Walking on the streets of Caracas you see the
continuous presence of the same multinational corporations, the same
US fast
food restaurants, the same shopping malls like elsewhere. The
country's
economy is still run by private capital.
While Prout thinks in terms of self-sufficient regions, Venezuela
strives to
reduce its economic dependency and make itself self-sufficient. On
the
whole Venezuela started the transformation from a very bad situation
from
the viewpoint of Prout: enormous inequality, dependence on the oil
prices
and on food imports, the concentration of 88% of the population in
cities,
lack of education, etc. From this state Venezuela slowly advances to
an
undefined goal, but the steps which have already been taken are
surprisingly
in harmony with an Indian thinker's vision made half century ago, a
vision
called Prout.
Andy Malinalco is an activist with the Prout Research Institute of
Venezuela
<http://www.ve.prout.org>www.ve.prout.org
Notes:
1 Michael A. Lebowitz: Venezuela: Going Beyond Survival, Making the
Social
Economy a Real Alternative.
<http://www.venezuelanalysis.com>www.venezuelanalysis.com 19 August
2006.
2 Though the company had been nationalized in 1976, it had in reality
been a
state-within-a-state. After the coup failed, the directors and
managers
announced a strike until Chavez resigned, locking out the workers and
effectively shutting down production to create panic and chaos as
gasoline
became unavailable throughout the country. Chavez then invited Ari
Rodriguez, then head of OPEC, to take over the company. He talked to
the
workers and asked if they could run the company without the former
bosses.
When they assured him they could, he fired the striking directors,
greatly
reducing the hugely bloated managerial salaries, and within three
months
production was back to normal.
3 Dada Maheshvarananda: After Capitalism. Washington, Copenhagen, New
Delhi,
Belo Horizonte, Proutist Universal Publications, 2003. pp.69-70.
4 Hugo Chavez Frmas: El Golpe Fascista Contra Venezuela. Ediciones
Plaza, La
Habana, 2003, p.16.
5 Dada Maheshvarananda: After Capitalism, pp.88-89.
Web Pages:
<http://www.ve.prout.org>www.ve.prout.org
<http://www.prout.org>www.prout.org
<http://www.proutworld.org>www.proutworld.org
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