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Labor and the State in a Party-Mediated Democracy: Institutional Change in Venezuela

Published online by Cambridge University Press:  12 October 2022

Jennifer L. McCoy
Jennifer L. McCoy*
Affiliation:
Georgia State University
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Political parties in Venezuela have historically played a mediating role between the state and the working class and also between labor and the private sector. Indeed, the political party system has been widely credited in the literature with sustaining the rather remarkable electoral democracy in Venezuela since 1958. Yet structural change in the world oil market and the Venezuelan economy in the early 1970s combined with the dynamics of past state-labor-party relations have produced an expanded role for the state in the economy as well as in the system of industrial relations. New patterns of interest mediation have emerged that have facilitated the adjustment of the democratic regime to changing political and economic conditions, thus helping to ensure its survival.

Type
Research Article
Information
Latin American Research Review , Volume 24 , Issue 2 , 1989 , pp. 35 - 67
Copyright
Copyright © 1989 by the University of Texas Press

Footnotes

*

I would like to thank David Collier, Ruth Berins Collier, Charles Davis, Raymond Duvall, Gary Wynia, and the LAR anonymous reviewers for their very useful comments on earlier versions of this article.

References

Notes

1. See, for example, John Martz, Acción Democrática: Evolution of a Modern Political Party in Venezuela (Princeton, N.J.: Princeton University Press, 1966); Daniel Levine, Conflict and Political Change in Venezuela (Princeton, N.J.: Princeton University Press, 1973); Judith Ewell, Venezuela: A Century of Change (Stanford, Calif.: Stanford University Press, 1984); and Robert Wesson, Democracy in Latin America (New York: Praeger, 1982).

2. For discussions of types of labor incorporation, see Kevin J. Middlebrook, “The Political Economy of Mexican Organized Labor, 1940–78,” Ph.D. diss., Harvard University, 1981; Ruth Berins Collier, “Popular Sector Incorporation and Political Supremacy: Regime Evolution in Brazil and Mexico,” in Brazil and Mexico: Patterns in Late Development, edited by Sylvia Ann Hewlett and Richard S. Weinert (Philadelphia: Institute for the Study of Human Issues, 1982); and David Collier and Ruth Berins Collier, “The Initial Incorporation of the Labor Movement in Latin America: A Comparative Perspective,” paper presented at the Annual Meeting of the American Political Science Association, New Orleans, September 1985. For a somewhat different classification scheme, see Charles Davis and Kenneth Coleman, “Labor and the State: Union Incorporation and Working-Class Politicization in Latin America,” Comparative Political Studies 18, no. 4 (Jan. 1986):401; and Coleman and Davis, “Preemptive Reform and the Mexican Working Class,” LAR 18, no. 1 (1983):3–31.

3. Middlebrook, “The Political Economy of Mexican Organized Labor,” 399.

4. Ruth Berins Collier and David Collier, “Inducements versus Constraints: Disaggregating ‘Corporatism,‘” American Political Science Review 73 (Dec. 1979):967–86. Inducements to labor groups include, but are not limited to, such provisions as registration of unions, compulsory union membership or dues checkoffs to encourage union formation and strength, the right of combination to protect union leaders, monopoly of representation, and state financial subsidies to unions. The major constraints involve state intervention in the collective bargaining process and the right to strike—labor's most fundamental weapon. Additional constraints limit the demands and the activities open to unions, control union leadership, and provide for state intervention in internal union affairs. Note that the initial registration of unions is viewed as an inducement; however, subsequent state regulation and control over union registration can also be a constraint. Middlebrook has also analyzed the mechanisms available to the state to regulate labor behavior, distinguishing between state subsidy (economic, legal, and political provisions) and control of labor organizations in Mexico (state regulation of labor's economic and political participation through the development of state administrative structures such as the labor conciliation and arbitration boards). See Middlebrook, “The Political Economy of Mexican Organized Labor.” This distinction between state subsidy and state control closely parallels Collier and Collier's disaggregation of corporatism into inducements and constraints.

5. See Charles Bergquist, Labor in Latin America (Stanford: Stanford University Press, 1986), chap. 4; and Julio Godío, El movimiento obrero venezolano, vol. 1 (Caracas: Editorial Arte, 1985).

6. Stuart Fagan, “Unionism and Democracy,” in Venezuela, the Democratic Experience, edited by John Martz and David Myers (New York: Praeger, 1977), 176.

7. The four political parties represented in the Comité Sindical Unificado were Acción Democrática (AD), the Comité de Organización Política Electoral Independiente (COPEI), the leftist Unión Republicana Democrática (URD), and the Partido Comunista de Venezuela (PCV).

8. The text of the accord is provided in Revista sobre Relaciones Industriales y Laborales, no. 1 (July–Aug. 1979):39–41.

9. For a discussion of the Programa Mínimo, see Terry Karl, “Petroleum and Political Pacts: The Transition to Democracy in Venezuela,” LAR 22, no. 1 (1987):63–94.

10. Fagan, “Unionism and Democracy.”

11. Acción Democrática, Tesis sindical, cited in Julio Godío, El movimiento obrero venezolano (Caracas: Editorial Arte, 1985), 2:170–75.

12. Declaración de principios of the CTV, cited in Godío, El movimiento obrero venezolano, 2:201–21.

13. Cecilia M. Valente, The Political, Economic, and Labor Climate in Venezuela (Philadelphia: Industrial Research Unit, Wharton School, University of Pennsylvania, 1979).

14. Margarita López Maya and Nikolaus Werz, “El estado venezolano y el movimiento sindical,” CENDES mimeo, Universidad Central de Venezuela, 1981. This study also appeared under the same title in Revista Relaciones de Trabajo, no. 2 (1983).

15. The state provides subsidies in a number of ways. Direct quotas are provided to all labor confederations, with the CTV receiving by far the largest share. Most of these funds go to the highest level of the organization, while regional federations and local unions rely on members' dues. Indirect subsidies come in the form of congressional appropriations for the construction of casas sindicales (union buildings) and government funding for training and recreation facilities of INCRET. External support has come from the United States in the form of worker training support and technical advice from the American Institute for Free Labor Development and the Alliance for Progress. Additionally a large loan from the American Federation of Labor-Congress of Industrial Organizations provided the funds for the CTV's initial purchase of 20 percent of the shares of the new Banco de Trabajadores Venezolanos in 1968. For discussions of union financing and subsidies, see Stuart Fagan, “The Venezuelan Labor Movement: A Study in Political Unionism,” Ph.D. diss., University of California, Berkeley, 1974; Julio Godío, El movimiento obrero venezolano 2; and Jennifer L. McCoy, “Democratic Dependent Development and State-Labor Relations in Venezuela,” Ph.D. diss., University of Minnesota, 1985.

16. For a detailed analysis of the Venezuelan political party system, see Daniel Levine, “Venezuela since 1958: The Consolidation of Democratic Politics,” in The Breakdown of Democratic Regimes: Latin America, edited by Juan Linz and Alfred Stepan (Baltimore: Johns Hopkins University, 1978); and John Martz, “The Party System: Toward Institutionalization,” in Venezuela: The Democratic Experience, edited by Martz and Myers.

17. See the discussion of Gramsci's concepts in Ruth Berins Collier, “Popular Sector Incorporation and Political Supremacy: Regime Evolution in Brazil and Mexico,” in Hewlett, Brazil and Mexico.

18. While the private sector was not formally represented in the parties through any similar type of bureau, it exercised informal influence on government decision making through individual ties and its pressure group, Fedecámaras.

19. One tangible indication of the new bipartisan pact was the “institutional pact” of 1968, in which Acción Democrática and COPEI agreed that the party that won the presidency, even without winning a majority in Congress, would name the president of the Senado, while the opposition party would name the president of the Cámara de Diputados. The two parties would jointly agree on supreme court justices and officials like the comptroller of the nation. This pact lasted through the Herrera Campins administration. Interview with Luis Herrera Campins, Caracas, 15 Aug. 1987.

20. When international oil prices tripled in 1973–74, Venezuela's national income jumped 40 percent in one year and government revenues grew by 170 percent.

21. Banco Central de Venezuela, Anuario de Cuentas Nacionales (Caracas: Banco Central de Venezuela, 1984).

22. Janet Kelly de Escobar, “Las empresas del estado: del lugar común al sentido común,” in El caso de Venezuela, edited by Moisés Naím and Ramón Piñango (Caracas: Ediciones IESA, 1985).

23. For a detailed analysis of the role of the collective bargaining system in Venezuela, see Ricardo González Rincón, “Hacia un nuevo modelo de contratación colectiva en Venezuela,” Revista sobre Relaciones Industriales y Laborales (Oct.–Dec. 1980):49–50.

24. Fagan, “Unionism and Democracy,” 189.

25. Francisco Zapata, El conflicto sindical en América Latina (Mexico City: Colegio de México, 1986).

26. Between 1959 and 1968, new unions covered 282,365 workers; between 1969 and 1978, 119,320 workers were unionized. See Ministerio de Trabajo, Memoria y Cuenta, 1982. Even though the number of workers covered by collective contracts increased in the second decade due to continued union expansion, the proportion of those workers who participated in strikes grew even faster. See Zapata, El conflicto sindical, t. III-25.

27. Note that Zapata rejects an economic explanation of strike levels in favor of a political explanation, arguing that wages kept pace with and sometimes rose ahead of inflation in the 1970s. His data, however, come from the International Labour Organization's Yearbook of Labour Statistics, which gives nominal wage rates, not real wage rates, as he claims in his tables and text. See Zapata, El conflicto sindical.

28. For sectoral data, see International Labour Office, Yearbook of Labour Statistics (Geneva: International Labour Office), various years. For regional data, see the Ministerio de Trabajo's Memoria y Cuenta for various years.

29. Interview with Carlos Andrés Pérez, Caracas, 12 Aug. 1987.

30. For a discussion of the commission's implications for the private sector as illustrated in the 1978 tax reform, see Diego Abente, “The Political Economy of Tax Reform,” Comparative Politics, forthcoming.

31. Interview with an anonymous member of the CTV executive committee, Caracas, 1 Mar. 1983.

32. See McCoy, “Democratic Dependent Development,” chap. 7.

33. “Ley contra despidos injustificados,” in Juan Garay, Legislación laboral práctica, 7th ed. (Caracas: Hijos de Ramiro Paz, 1982).

34. Decreto ejecutivo, no. 1649, 23 June 1976.

35. Ley de trabajo, Artículo 18.

36. Reglamento, Artículo 24.

37. Informe del presidente, VIII Congreso de CTV (Caracas: Avila Arte, 1980), p. 13.

38. Interview with the Najah Kafrouni de Rauseo, Chief of Selective Immigration, Ministerio de Trabajo, Caracas, 28 Feb. 1983; see also Decreto ejecutivo 1303, 26 Nov. 1981.

39. Responding to criticisms that he had failed to consult with interest groups on crucial economic policy decisions, Luis Herrera Campins explained that although he believed that formal high-level commissions are not always effective, informal lines of communications are crucial and were always kept open in his administration from the local to the national and sectoral levels. Interview, Caracas, 15 Aug. 1987.

40. Informe del presidente, 15–19.

41. See Garay, Legislación laboral práctica, 7th ed., for the text of the Ley de Trabajo, the regulations implemented in February 1974, and presidential decrees and other laws implemented between 1974 and 1982.

42. Ley de trabajo, Artículos 166 and 193.

43. See McCoy, “Democratic Dependent Development,” chap. 6.

44. Collier and Collier, “Inducements versus Constraints,” 981.

45. Reglamento, Título 7.

46. The number of industrywide contracts negotiated by the government under Decree 440 and extended nationwide has nearly doubled, from an average of 7.5 contracts per year between 1958 and 1969 to 14 per year between 1970 and 1981. Figures calculated from Ministerio de Trabajo Memoria y Cuenta, volumes for 1958 through 1981.

47. Artículo 198.

48. Fagan, “The Venezuelan Labor Movement,” 185.

49. According to the law, representatives must not be directly involved in the dispute, but in practice, they often are. Ibid., 181.

50. Ley de trabajo, Artículo 237.

51. Reglamento, Artículo 393.

52. For examples, see Equipo Proceso Político, CAP: 5 Años (Caracas: Editorial Ateneo), 75–79.

53. Reglamento, Artículos 383–408.

54. The exception to this regulation since 1980 have been teachers. White-collar employees are covered by the Ley de Carrera Administrativa. See also Ley de trabajo, Artículo 6.

55. “Instructivo presidencial,” no. 1, cited in CAP: 5 Años, p. 11.

56. CAP: 5 Años, p. 11; and Godío, El movimiento obrero venezolano, vol. 3 (Caracas: Editorial Arte, 1985).

57. An anonymous reviewer of this article argued the reverse, that growing labor conflict in 1977–78 may have been a response to a clampdown by the Pérez administration. But intensified labor conflict was evident as early as 1969, while the labor law reforms were passed in 1973.

58. Informe del Presidente, 1980, appendix.

59. Resumen no. 361 (5 Oct. 1980), p. 12.

60. While the CTV initially received 20 percent of the shares in the BTV, by 1983 the labor movement had obtained 57 percent and the state 43 percent of the shares. Interview with an anonymous member of the Congressional Investigation Commission of the BTV, Caracas, 17 Feb. 1983.

61. For example, during the 1983 presidential nomination process, the AD labor bureau was instrumental in getting AD Secretary General Jaime Lusinchi nominated. It was reported that labor support was given in exchange for a labor leader being nominated for secretary general of the party. Interview with an anonymous member of the Congressional Investigation Commission of the BTV and Latin American Regional Report-Andean Group, 26 Feb. 1982. Whether or not an explicit trade-off was arranged, the fact remains that labor leader Manuel Peñalver assumed the post of AD Secretary General after Lusinchi was nominated for president.

62. The bank was governed by its own law of creation and thus avoided some of the regulation provided for in the general banking law.

63. Resumen no. 485 (20 Feb. 1983), p. 4.

64. Luis Gómez, “Del Pacto de Punto Fijo al Pacto Social: desarrollo, hegemonía y actores políticos en la Venezuela actual,” CENDES mimeo, Universidad Central de Venezuela, which summarizes Margarita López Maya, “El caso de la intervención del BTV,” CENDES mimeo, Universidad Central de Venezuela.

65. Gómez, “Del Pacto de Punto Fijo.”

66. For a discussion of this and other measures in response to the debt crisis between 1979 and 1988, see Jennifer McCoy, “Venezuela: Austerity and Interest-Group Politics in a Democratic Regime,” in Paying the Costs of Austerity in Latin America, edited by Howard Handelman and Werner Baer (Boulder, Colo.: Westview, forthcoming).

67. Confidential interviews, Caracas, 3 Feb. 1983 and 7 Feb. 1983.

68. Gómez, “Del Pacto de Punto Fijo al Pacto Social.”

69. Three years later in 1985, the BTV was returned to the CTV with a promise of five billion bolívares in government bonds (U.S. $650 million). The decision to return the bank was made by AD President Lusinchi in the wake of strong criticism of his policies during the CTV congress in May 1985. See Latin American Weekly Report, no. 22 (7 June 1985), p. 9.