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From The Socialist newspaper, 11 May 2006


Morales takes on 'Big Oil'

The part-nationalisation of Bolivia's gas and oil industry by president Evo Morales, similar to Hugo Chávez's decree in Venezuela earlier this year, is another blow to the 'neo-liberal' agenda of big business and imperialism in Latin America.
 This measure reflects years of bitter struggles by Bolivia's working class and indigenous poor to reclaim the country's resources for their own interests.
KARL DEBBAUT reports on the political implications.

"THE SPANISH, the North Americans, the Europeans looted the tin, the silver and the natural resources. We should recognise that in 1937, under the leadership of the armed forces petroleum was nationalised for the first time, the second nationalisation was carried out in 1969 with the intellectual Marcelo Quitoga Santa Cruz and his struggle continues today".

So declared Bolivian president Evo Morales on May Day 2006 as he announced a presidential decree reversing the privatisation of the oil and gas industry instituted in 1996.

Making his speech in the south eastern department of Tarija Morales was flanked by various ministers. In addition, the army stepped in and guarded all major installations and refineries.

Everywhere huge May Day demonstrations took place. The jubilant masses were celebrating what they see as a first step to the full nationalisation of the oil and gas industry. Jose Lopez, a Santa Cruz native, expressed his joy: "For the first 100 days of his rule, Evo didn't do the things he said he would. But this was much better. Now everyone is behind him again".

Western imperialism's response to the "first nationalisations of the 21st century" as the vice-president Alvaro Garcia Linera called the move, was one of condemnation. The Spanish president and 'social democrat' Jose Luis Rodriguez Zapatero threatened to cut the Spanish aid budget to Bolivia. The Brazilian 'social democrat' president Lula called the move "unfriendly," while the American Secretary of State Condoleezza Rice accused Morales of "demagoguery".

The Movement towards Socialism or MAS, the party of Evo Morales, may present the presidential supreme decree 28701 as its gift to the masses but in reality it isn't theirs to give.

The struggle of the Bolivian working class and poor masses with its main demand for the nationalisation of the hydrocarbons industry, known as the 'gas wars', has dominated the political landscape for the last four years.

The mobilisations of the working class, organised in trade unions and community committees, has led to the downfall of two governments. The MAS was largely a bystander in the uprising of October 2003 and the mass mobilisations of May and June 2005.

Nationalisation or renegotiation

The biggest foreign operators in Bolivia are Spanish-run Repsol and principally PetroBras, the state owned Brazilian giant. The Bolivian affiliate of Petrobras accounts for 24% of Bolivia's tax receipts, 18% of its GDP. Beyond this Petrobras itself operates 75% of the gas exports and 95% of Bolivian refining capacity.

The decree passed by Evo Morales stops short, at present, of the expropriation of the multinationals. Instead, the state run oil and gas company, the YPFB or Yacimientos Petroliferos Fiscales, (all but destroyed in the privatisation process of 1996), will be resuscitated to take majority control over all the gas fields and installations.

The multinationals, who have made enormous profits over the last ten years by paying only 18% tax, will be made to pay 82% tax and have, under the new agreement proposed to them, control over only 18% of the resources which they exploit. If they do not agree to renegotiated contracts over the next 180 days the government has threatened to expropriate them.

The working class has been demanding outright nationalisation of the hydrocarbons, with the most foresighted layers in the Bolivian trade union confederation COB, demanding workers' control and management of the industry as a first step towards finishing with capitalism and build a socialist society


Morales and the MAS have never committed themselves to such a course. Throughout the election campaign Morales has said that he wanted to renegotiate foreign ownership of Bolivia's natural resources. This would not be appropriation, it would not be nationalisation, it would be a renegotiation of contracts.

Nevertheless such is the pressure of the mass movement that Morales might be forced to nationalise completely. The first 100 days of the Morales government has seen it swinging from left to right and back again in an attempt to try and find a balance between the interests of the masses and appeasing imperialism.

Morales and his government repressed mobilisations of striking airline workers, and reneged on a promise to increase the minimum wage by between 50% and 100%. It seems that in the last couple of weeks the social temperature had been rising again in Bolivia. An announced general strike for 4 May in the Santa Cruz region was called off only after the announcement of the hydrocarbons decree.

The announced decree by the Bolivian government will be perceived by Western imperialism as a threat to their interests and welcomed by the Bolivian masses. However, the situation in Bolivia, with two-thirds of the population living in absolute poverty, is crying out for a break with capitalism and the building of socialism.

Boasting the most unequal distribution in wealth in Latin America, the richest ten per cent of the population have an income 143 times greater than the poorest 10%. In rural areas the ratio is 170 times greater!

Only by taking full control over the natural resources of the country, and the leading sectors of the economy, under workers' control and management, will it be possible to work out a democratic plan to use the richness of resources and the value created by the labour of the working class for the good of the country.

Bolivia's May Day

Hundreds of thousands of workers and poor took part in the May Day demonstrations.

An eyewitness report says: "I walked past the Coca-Cola workers with their red union jackets, Che [Guevara] emblazoned on the left breast pocket. Factory workers, pensioners, indigenous peasant groups from the altiplano, teachers, informal workers of a thousand varieties and thousands upon thousands of disciplined marching women from various sectors, some in indigenous dress, others in jeans and union jackets. The only people working were the street vendors."

The placards, signs and banners on the march paid homage to the international martyrs of the working class. One banner read: "Glory to the martyrs of Chicago who offered their lives for the eight-hour day"; and linked this with the continued fight in Bolivia. Other placards demanded: "Out with the looting transnational corporations", and "Nationalisation of the hydrocarbons now".

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In The Socialist 11 May 2006:

Socialist Party election analysis

Victory for NHS campaign

Huddersfield: voters choose a socialist and a fighter!

Third socialist councillor elected in Coventry

Increased votes for socialism in Lewisham

Stoke - BNP wins close-run election

Excellent results for the Socialist Party

Local elections: A death blow for Blair?

Dangers in Respect's development

Socialist Party NHS campaign

Stop the threats to the NHS

International socialist news and analysis

Female factory workers in Russia start hunger strike

Venezuela: Fight for socialism

Iraq - the nightmare continues

Germany: 'Unity' at the expense of the working class

Morales takes on 'Big Oil'

Socialist Party workplace news

Postal union rejects pay offer

Student union leaders hide truth about lecturers' action


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