No. 495

Original article is at

Coup-making in Venezuela: the Bush and oil factors
by Karen Talbot • Friday July 26, 2002 at 07:46 AM 212-924-2523 235 W 23 st., NYC 10011

     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.

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

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. 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

"[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.

                    Why does the US want war with Iraq?

Saddam is certainly a nasty ****. His regime is brutal. He has used
biological and chemical weapons against his own people. He allows no
opposition, and uses murder and torture to remain in power. The thought
that he might have nuclear weapons is a frightening one. Yet it is naive in
the extreme to think the Bush administration is motivated by these issues

The most common reason for war, cited by both Democrat and Republican
members of Congress is Iraq's attempts to build weapons of mass destruction
and his violations of UN resolutions. The trouble is the same arguments
could just as easily be applied to Israel, which possesses nuclear bombs
now and ignores UN resolutions. Yet there are no plans to bomb Tel Aviv. Or
how about Pakistan, which is run by a military dictator, has actually test
detonated nuclear weapons and in recent months has been one half of the
quite credible threat of a nuclear war (with India).

Algeria and Egypt are both countries in which serious human rights abuses
have been reported. Yet the US isn't talking about invading either of these
countries either. In the past the US was quite in favor of Saddam's
dictatorship. They sold him arms throughout the Iran/Iraq war. During the
Iran and Iraq war Saddam dropped gas on a village called Halabja. The US
not only blocked UN resolutions condemning Saddam but issued reports
blaming Iran for the attack. They kept silent as he carried out genocide on
the Kurds in the 1980s. Given US history in Iraq it is stretching it to
imagine that they suddenly have a problem with the use of chemical and
biological warfare.

Which brings us to the question of motivation. Why is this war going to be
fought? There doesn't seem to be a simple answer to this question. The
Republican Party, US business interests and other countries in the world
all seem to be split on the issue. Indeed only Bush's immediate
administration and Blair seem to be in favour of war. Comment writers have
even been wondering if is this a moral crusade?

However, like most other wars, this is about control of resources. Bush Jnr
is the Oil Barons' president. Vice President Dick Cheney is the former head
of an oil company called Halliburton Co. In 2001 the Washington Post
reported that he signed contracts with Iraq worth 73 million dollars. Dick
Chaney explained his opposition to Saddam by saying "He sits on top of 10
percent of the world's oil reserves. He has enormous wealth being generated
by that. And left to his own devices, it's the judgement of many of us that
in the not too distant future he will acquire nuclear weapons". It's
interesting to note that Chaney places oil above nuclear weapons in his
list of concerns.. US corporations have heavily invested in the Audi
Arabian oil industry. That most of the September 11th bombers came from
that country makes the US nervous about its dependency on the Saudi royal

Wars are also good for the economy, and the US economy certainly could need
some help at the moment. Although the stock market falls in the lead up to
conflict, once the bombs start going down, the share prices start going up.
According to the Sunday Times business correspondent Kathryn Cooper,
American share prices rose by 36% during four recent wars. Oil companies
also benefit. Iraq is the world's second largest producer of oil (after
Saudi Arabia). An attack would disrupt its oil supplies. Other oil producer
countries could then increase the price of their oil. Arms dealers also
benefit, and also fund election campaigns. Something Bush JR knows well.

Yes Saddam has to go. But it is mistaken to think that if the US get rid of
him Iraq will become a better place. After the 1991 gulf war George Bush
Snr called on the people of Iraq to overthrow Saddam. The US then stood
back and watched as Saddam massacred whose who tried. Collateral benefit is
the idea that although the war is being fought for 'non-humanitarian'
reasons such as oil, side effects such as the removal of Saddam can be
positive. Any idea that there are 'collateral benefits' to US intervention
have already been exposed as false by experience. As the Revolutionary
Association of Women of Afhanistan have pointed out women still lead
insecure fearful lives. The Northern Alliance replaced the Taliban, but
nothing much has changed.