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A War for Oil? Bolton Pushes Privatization of Venezuela’s Oil as U.S. Ratchets Up Pressure on Maduro

StoryJanuary 30, 2019
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As the Trump administration continues its attempt to oust Venezuelan President Nicolás Maduro, the U.S. has imposed a de facto embargo on oil from Venezuela’s state-run oil company. The new sanctions include exemptions for several U.S. firms, including Chevron and Halliburton, to allow them to continue working in Venezuela. We speak with prize-winning investigative journalist Allan Nairn about the push to privatize Venezuela’s oil.

This is a rush transcript. Copy may not be in its final form.

AMY GOODMAN: So, let’s go to John Bolton, the national security adviser, on Fox Business.

JOHN BOLTON: We’re in conversation with major American companies now that are either in Venezuela or, in the case of Citgo, here in the United States. I think we’re trying to get to the same end result here. You know, Venezuela is one of the three countries I call the troika of tyranny. It will make a big difference to the United States economically if we could have American oil companies really invest in and produce the oil capabilities in Venezuela. It’d be good for the people of Venezuela. It’d be good for the people of the United States.

AMY GOODMAN: So, that’s the quote of John Bolton on Fox. And at the same time, you have the United States imposing sweeping new U.S. sanctions on Venezuela’s state oil company.

ALLAN NAIRN: Well, that statement from Bolton is remarkable. And it sounds like he’s implementing the Trump doctrine of “to the victor belong the spoils, take the oil,” because what Bolton is proposing there is not just to overturn the policy of the Bolivarians, the Chávez movement; he’s talking about overturning the oil policy that existed before Chávez came to power, under the previous U.S.—essentially, U.S.-directed conservative governments in Venezuela. When Chávez came to power, the oil company in Venezuela was already nationalized. He inherited that. He did not suddenly nationalize an oil industry that was controlled by American corporations. It was already done by his predecessors. So, he’s actually—Bolton is actually proposing a radical change in the traditional economic policy of Venezuela.

And also, by the way, the idea that the Venezuelan oil company is some alien force to Americans is not true. Many of your viewers have probably been to what used to be called Cities Service, what now are called Citgo, gas stations across the United States. These are the stations of Citgo, which is the American subsidiary of the Venezuelan state-owned oil company, and they’ve been doing business, you know, in a normal business fashion in the United States for decades upon decades.

And another thing that’s interesting about that comment from Bolton is it doesn’t—if you really study it, it doesn’t even have an economic rationale. Let’s say if you’re just thinking in strictly self-interested economic terms for the United States as an entity, that wouldn’t even make sense, because in today’s world, your worst enemy will still sell you oil at the market price. And there’s not a whole lot of difference economically between controlling the oil fields yourself and buying the oil that’s produced by them on the open market, regardless of who does the production. The discipline of the market ensures basically a uniform price that’s determined by the market and not by the political wishes of the oil producer. That’s the way it works in today’s world.

So, the reason for Bolton advocating having the U.S. companies coming in and seizing the oil is more political, making—one, giving the U.S. a source of leverage, deciding where that oil can go and where the—how the oil revenues can be used, because, up to now, first under Chávez and continuing, to a certain extent, under Maduro, the Venezuelan government, the Bolivarian government, has used those oil revenues for several political purposes. One is to fund social programs that have helped the poor. And, in fact, that was the specific reason that the rich, after ’02, went on strike against Chávez, trying to bring down the economy, because they objected to the oil revenues being used for social programs for the poor. They wanted the oil revenue to flow somehow into their pockets.

And secondly, Venezuela has sometimes used that oil revenue—or, that oil for foreign political purposes. For example, they assisted Haiti, in providing oil to Haiti and canceling—announcing a cancellation of Haiti’s oil debts, a number of years back, under Chávez, when Haiti was in particularly desperate straits. Even in the United States, even in Boston, Congressman Joe Kennedy, the former congressman, years ago, established a program in Boston to provide low-cost heating oil to his lower-income constituents in the Boston area, and part of the way he did that was by making an arrangement with the Venezuelan oil company.

So, if you had American corporations in control of the Venezuelan oil, these kind of political choices could of course be reversed. But in raw economic rationale terms, it wouldn’t make sense at all. It’s a very bold, I think very revealing, initiative by Bolton, and it shows where the U.S. is going on Venezuela now. It shows that the U.S. is seeking to impose what is really a radical-rightist revolution now on Venezuela, because they’re not just proposing to overturn the economic legacy of Chávez, but even of his more conservative predecessors, if they’re talking about privatizing the oil.

And by the way, the economic policy of Chávez, and later Maduro, it’s depicted in the U.S. press as being, you know, communist or even socialist, to a very strong extent. But it actually isn’t. If you look at the figures of how the—structurally, how the Venezuelan economy operates, the government controls about a third of the private corporate equity in Venezuela. The level of government spending for social programs in Venezuela is not that much higher. It’s only about two points higher than the level in the United States. There are all sorts of private businesses that operate freely. And then, in fact, in the past few years, as the crisis has intensified, while many of the private businesspeople, oligarchic types have been funding the opposition, others—and maybe even some of the same people, behind the scenes, have been cozying up to the Maduro government, and there have been number of—there have been a number of deals between them.

But what Venezuela basically has is a mixed economy, where there’s been a big emphasis on doing things like encouraging cooperatives and so on. But in recent years it’s been run into the ground, in part by bad decisions by the government. For example, there was just a catastrophic monetary policy that they adopted for quite a few years, where Venezuela, on what they said were anti-imperialist, revolutionary grounds, they essentially adopted the monetary policies proposed by the U.S. right-wing politician Ron Paul, and they kept the currency exchange rate fixed, with catastrophic consequences, creating this massive gap between the official exchange rate and the black market. And that ended up benefiting rich people, who had—who were able to—it helped them to buy imports. But it completely disrupted the rest of the economy. So, it’s been very far from a leftist—a far-leftist government.

AMY GOODMAN: Award-winning investigative journalist Allan Nairn, speaking to us from Jakarta, Indonesia. Allan has won some of the most prestigious honors in journalism. He’s a two-time winner of the George Polk Award and a recipient of the R.F. Kennedy Journalism Award, as well as the Alfred I. duPont-Columbia Award.

To see all of our coverage on the crisis in Venezuela, go to democracynow.org.

Special thanks to Park City Television for hosting us here in Utah this week. We’ll continue our coverage of the Sundance Film Festival tomorrow.

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