Latin America: Energy Workers in Time of Crisis


by Prof. James Petras
Global Research, July 18, 2009


The situation of the energy sector in Latin America is determined by both internal and external correlations of political forces, the level of class organization and power within the ruling and the working classes, the condition of the world economy and the strength and weakness of US imperialism. The ‘situation of the energy sector’ refers to several variants in terms of ownership, weight in the economy and distribution of oil revenues within the class structure.

Internal and External Correlation of Forces

The correlation of forces between capitalists and workers in the energy sector in Latin America varies greatly: In Venezuela, the Chavez government, with the backing of the oil workers union, has extended public ownership and distributed oil revenues to the popular classes through food subsidies, universal health and public education programs. At the other extreme in Colombia under President Uribe, private foreign oil companies are increasingly in control, profits are repatriated to the imperial countries or taken out of the country by the domestic elite, government revenues subsidize the oligarchy and government-backed death squads and the military to assassinate and threaten trade union and community leaders.

Between these two poles of the nationalist left and the neo-fascist right, several other variants exist: Social democrat, social liberal and neo-liberal.

Bolivia and Ecuador, under Evo Morales and Rafael Correa, represent the social democratic approach, proposing ‘partnerships’ between ‘state’ and foreign capitalist oil companies, which share the profits from exploitation of crude petroleum. The foreign companies still control most or all of the refining and trading and the social democratic government have yet to establish their own ‘marketing systems’.

The ‘social liberal’ policies are found in Brazil and Argentina where the major oil companies are ‘state’ only in name only, as they are traded on the stock markets in Latin America and Wall Street. State revenue is distributed in an unequal proportion, the bulk used to subsidize the agro-mineral sector and minority share to fund social programs – including basic anti-poverty programs.

The neo-liberal policies are found in Mexico and Peru where former publicly owned oil companies and energy resources have been handed over to foreign oil and energy companies.In Mexico only the militancy of the electrical workers union(SME) has prevented the government from privatizing this strategic industry. Under the neo-liberal regimes the oil and energy revenues have been distributed almost exclusively among the foreign and domestic ruling class and only a minimum’ trickles down’ to the workers, peasants and Indian communities in the form of subsistence “poverty programsâ€