Posted on 01/09/2003 2:39:46 AM PST by Cincinatus' Wife
"It doesn't help when you have a government that denies this is happening just because the street vendors are out there," Herrera said. "It's really Kafkaesque. An open barber shop doesn't make an economy."
VALENCIA, Venezuela - Graciela Martinez can't serve Coca-Cola in her small diner, located just around the corner from Venezuela's Coca-Cola bottler in this high desert city.
Coke, like many products produced by multinationals in a vast industrial park here, has been virtually impossible to get since Venezuela's opposition began a strike Dec. 2 to demand that President Hugo Chavez call early elections.
Officials at Coca-Cola and other multinationals say they haven't joined the strike. They just can't operate in the volatile economic and political climate that has engulfed Venezuela.
"We are a totally apolitical company," said Jorge Jezerskas, spokesman for Panamco, the Coca-Cola bottler in Venezuela.
"But for 36 days, our suppliers haven't been able to send us raw materials. If our drivers can get enough gas to make a delivery, then they aren't sure they'll be able to get gas to come back. What can we do?"
The Panamco plant appears abandoned, with only a pair of security guards and a gardener out front. The company sent its 4,500 employees on vacation on Dec. 10. Another 4,300 temporary workers are simply out of work.
Ford Motor Co., General Motors Corp., Mazda Motor Corp., Bridgestone-Firestone, Goodyear and others also have factories idling here. Ford sent its 1,300 employees on vacation on Dec. 3, and doesn't expect to call them back before Jan. 28, Ford spokesman Ricardo Tinoco said.
At Procter & Gamble's Caracas headquarters, a woman answered the phone by saying, "Strike," then hung up. Corporate officials in Cincinnati said they also couldn't reach their Venezuela office by telephone.
The strike has been most effective in Venezuela's oil industry, which provides half of government income and 80 percent of export revenue. The world's fifth largest oil exporter has been forced to import gasoline.
Political unrest damaged the economy before the strike. The economy shrank by at least 8 percent in 2002. Inflation surpassed 30 percent.
Direct foreign investment has fallen dramatically in the past five years, from $1.5 billion in 1998 to just $246 million in the first nine months of 2002, according to the Venezuelan American Chamber of Commerce.
Most of the chamber's more than 1,000 affiliate businesses are closed "for varying reasons," said chamber vice president Antonio Herrera.
Chavez insists he is breaking the strike. His government cites bustling activity in the large informal sector and in the country's poorer regions, as well as a gradual upsurge in oil operations.
Negotiations sponsored by the Organization of American States have failed to end the crisis, with both sides standing firm.
"It doesn't help when you have a government that denies this is happening just because the street vendors are out there," Herrera said. "It's really Kafkaesque. An open barber shop doesn't make an economy."
Local personnel are striking; security and transport issues affect employees' ability to report to work; ports are all but closed; cash flows and collections are disrupted; financing expenses have soared, it said.
"Many international companies have received orders from their headquarters to keep operating, but they can't," explained Imelda Cisneros, a former cabinet minister who runs the Venezuela office of Arthur D. Little, an international consulting firm.
"Industry is stopped, some out of commitment (to the strike), others because they have no other option," she said.
Panamco normally ships 16.4 million cases of Coca-Cola to 200,000 stores, bars and restaurants around the country every month, Jezerskas said. In December, the company lost $40 million as well as a truck that was attacked and burned, apparently by the opposition, he said.
The new constitution, through design and circumstance, ended up concentrating power in the presidency and eliminating most checks and balances. It was drafted by a constituent assembly elected through a rule that gave Mr Chávez 92 per cent of the seats with just over 50 per cent of the vote, essentially disenfranchising the opposition. This winner-take-all assembly dissolved the elected Congress and appointed loyal supporters to the Supreme Court, the attorney-general and the comptroller-general without following constitutional procedures. In addition, the new constitution extended the presidential period, allowed for a one-time re-election and substituted a two-chamber congress with a one-chamber national assembly, in order to lessen the burden of consensus-building. This concentration of power has allowed the government to get away with murder, misuse public funds, arm violent gangs and disarm opposition local police.***
It is on this backdrop that Venezuela seeks a solution not just to the strike, but also to a profound social split considered the root of its political crisis. So far, Chávez has rebuffed calls for new elections, and strikers have rejected cries to go back to producing gasoline and selling goods. While international negotiators mediate, people like Avila choose to pay the price. ''This strike will cost a lot,'' Rodríguez said, ``It will cost them.''
In many ways, Avila, 51, represents the ''oligarchy'' Chávez scorns. He owns 13 of Venezuela's Subway shops, and has the franchise rights on the other 63. The Florida International University graduate describes himself as a self-made man, not a millionaire, who is ''active'' in the strike -- but not an ``activist.'' Articulate and persuasive, Avila is absolutely convinced that despite huge financial losses, owners of Venezuela's 129 McDonald's, 60 Wendy's, 23 Papa John's and 20 Burger Kings -- the country's third-largest employer -- did the right thing in shutting down. For the Subway chain alone, the December loss in sales amounted to some $1.5 million. 'Some people are saying, `We are going broke! This is what Chávez wants!' '' Avila said. ``I believe whoever resists more wins.'' Each Subway owner gave up about $25,000 in sales -- about $6,000 in profits -- since the Dec. 2 strike began. For Avila, who also gets a tiny percentage of the profits from the Subways he does not own, December's personal losses total about $80,000.
''This situation brings passion, patriotism, and, in its wake, depression, worry, financial difficulty and family friction,'' Avila said. ``Despite everything, each of us feels a conviction to add our grain of sand. Nobody is forcing us to close. ``We're doing this for the future of our businesses, never mind our children.'' Strikers like Avila believe Chávez, a former paratrooper, is building a totalitarian regime. They see Venezuela just like 1960 Cuba, initially enthralled with a leftist firebrand who later introduced communism.
Elected twice, Chávez first enjoyed enormous popularity, which later plummeted when he took advantage of that support to pass referendums to consolidate his power. Chávez controls the National Assembly, the Supreme Court and tried to take over Caracas' Metropolitan Police. He does not wield much influence over the 35,000 people at the state-owned oil company, who led the work stoppage now causing seven-hour lines at the pump.
About 30 percent of the population, including the miserably poor, are devout Chávez followers. They include Rodríguez, all of his employees and most of his customers. 'I ask you, `What strike?' '' Rodríguez, 45, said Saturday from behind the register of Boulevard Plaza 2000, the busy cafeteria he owns in Caracas' pro-Chávez Catia neighborhood. ''Look,'' he said, ``I have customers. I have gas in my car and food to sell. The refrigerator is full of milk.'' Chávez supporters like him never thought about joining the strike, even as stores in Catia ran out of products to sell. Beer and soda distributors stopped delivering, and flour is often difficult to come by. But Rodríguez is as equally committed as Avila, and just as convincing when he argues for his favorite politician. ''OK, I admit: Business at the horse betting parlor upstairs is a bit off, because I can't sell them beer,'' Rodríguez said, doubling over in laughter. ``This seems like a lie, but if you analyze it, the only ones suffering are the high class.''
Chávez has successfully painted his country's civil strife as a class war. The proletarians are for him, the bourgeoisie against him. But if 70 percent of Venezuelans live in poverty, then a chunk of the poor want him out. And Rodríguez admits he lives a comfortable life and even lives on the rich side of town. ''I have voted for [Chávez] five times and will vote for him the next time,'' Rodríguez said. [End]
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