• Monthly
  • $25
  • $50
  • $100
  • $other
  • use PayPal

ONE WEEK TO DOUBLE YOUR DONATION!

A generous supporter has offered a $25,000 matching grant. So for this week only, whatever you can donate will be doubled up to $25,000! If you have the means, please donate! If you already have done so, thank you for your support. All contributions are tax-deductible.
FacebookTwitterRedditEmail

A Radical, Questionable Move: Venezuela Withdraws Its 100 Bolivar Notes

Caracas.

Venezuela’s government has made the radical decision to withdraw the heretofore largest bill from circulation. President Nicolás Maduro made this decision public on Sunday, December 11, indicating that the 100 bolivar note would cease to be valid in 72 hours, after which it could be delivered to the country’s Central Bank.

The alleged reason for this decision is to strike at mafias engaged in illegal money transactions on the border with Colombia. It is also claimed that an NGO, with ties to the U.S. Treasury, aimed to buy up all the circulating currency and thereby destabilize the government. These heterogenous claims – the first tinted with anti-Colombian sentiment – are most likely not the real or at least not the central reasons for this surprising move.

Most likely the main objective in the demonetization of the 100 bolivar bill is to dramatically reduce liquidity and hence stem inflation. That is why the step has not produced significant resistance in the banking sector. The economist Francisco Rodríguez, former executive of Bank of America, sees it as positive.

The problem of illegal money, as Prabhat Patnaik explains reflecting on a similar move by Indian prime minister Modi, is much more complicated than simple stockpiles of cash. Obviously, a radical step like this one, in India or in Venezuela, could constitute a momentary blow to those involved in illegal operations, but it will not affect the essence of their various rackets, which will recover in the short or medium term.

How should a leftist evaluate this recent step? Undoubtedly, it affects the common people in their daily transactions: paying bus fares, buying newspapers, or making purchases in small markets without access to credit-debit card lines. It also touches the informal merchants who represent an important part of the economy. In Venezuela, the informal economy always grows around Christmas, with booming sales of trinkets, holiday foods, and crafts.

In the last instance, one’s evaluation of the step will go hand in hand with how one judges Maduro’s decision to rigorously satisfy the needs of financial capital in the country by paying all key bills and debts on time. These policies have made the Venezuelan president the most recent, if most surprising, poster boy of the Financial Times. The current step, because it tends toward macroeconomic stabilization, is in line with this general attitude.

However, I believe that this overall line is a mistaken one. Global financial capital cannot easily be made into a conjunctural ally. It is rather an inseparable, unshakable secret sharer. The bloc that Maduro may have in mind, composed of global financial capital at one extreme, and public employees and the poor masses on the other, is an unrealistic and unstable one.

It is an unstable alliance precisely because, when push comes to shove, the financial sector, which is supremely agile and well organized, will leave the popular elements by the wayside when it opts for one of the many other possible political alliances that are open to it. Socialism, even as a long-term goal, must step out of the picture.

What is being constructed has the appearance of a chimera in which a belligerent and pro-socialist discourse combines with a silent sell out. The president and other leaders may not be aware of this; they may think that the satisfaction of the financial world’s imperatives is just a short term, necessary concession. But insofar as it leads to demobilization, apathy, and confusion in what were once the pro-socialist bases, it also hamstrings the popular force that could redirect the country on a progressive or socialist path.

Socialism needs socialists, just as anti-imperialism needs antiimperialists. The errors of statist and substitutionist practices, which tempt leaders as the paths of least resistance, are well-known lessons of history. It is not with a public, televised discourse that one constructs socialism but with an organic force diffused among millions of individuals. Here, this is called “popular power,” and it is precisely what is in danger of being lost.

More articles by:

Chris Gilbert is professor of political science in the Universidad Bolivariana de Venezuela.

bernie-the-sandernistas-cover-344x550
October 15, 2019
Victor Grossman
The Berlin Wall, Thirty Years Later
Raouf Halaby
Kurdish Massacres: One of Britain’s Many Original Sins
Robert Fisk
Trump and Erdogan have Much in Common – and the Kurds will be the Tragic Victims of Their Idiocy
Ron Jacobs
Betrayal in the Levant
Wilma Salgado
Ecuador: Lenin Moreno’s Government Sacrifices the Poor to Satisfy the IMF
Ralph Nader
The Congress Has to Draw the Line
William A. Cohn
The Don Fought the Law…
John W. Whitehead
One Man Against the Monster: John Lennon vs. the Deep State
Lara Merling – Leo Baunach
Sovereign Debt Restructuring: Not Falling Prey to Vultures
Norman Solomon
The More Joe Biden Stumbles, the More Corporate Democrats Freak Out
Jim Britell
The Problem With Partnerships and Roundtables
Howard Lisnoff
More Incitement to Violence by Trump’s Fellow Travelers
Binoy Kampmark
University Woes: the Managerial Class Gets Uppity
Joe Emersberger
Media Smears, Political Persecution Set the Stage for Austerity and the Backlash Against It in Ecuador
Thomas Mountain
Ethiopia’s Abiy Ahmed Wins Nobel Peace Prize, But It Takes Two to Make Peace
Wim Laven
Citizens Must Remove Trump From Office
October 14, 2019
Ann Robertson - Bill Leumer
Class Struggle is Still the Issue
Mike Miller
Global Climate Strike: From Protest To Power?
Patrick Cockburn
As Turkey Prepares to Slice Through Syria, the US has Cleared a New Breeding Ground for Isis
John Feffer
Trump’s Undeclared State of Emergency
Dean Baker
The Economics and Politics of Financial Transactions Taxes and Wealth Taxes
Jonah Raskin
What Evil Empire?
Nino Pagliccia
The Apotheosis of Emperors
Evaggelos Vallianatos
A Passion for Writing
Basav Sen
The Oil Despots
Brett Wilkins
‘No Friend But the Mountains’: A History of US Betrayal of the Kurds
John Kendall Hawkins
Assange: Enema of the State
Scott Owen
Truth, Justice and Life
Thomas Knapp
“The Grid” is the Problem, Not the Solution
Rob Kall
Republicans Are Going to Remove Trump Soon
Cesar Chelala
Lebanon, Dreamland
Weekend Edition
October 11, 2019
Friday - Sunday
Becky Grant
CounterPunch in Peril?
Anthony DiMaggio
Fake News in Trump’s America
Andrew Levine
Trump’s End Days
Jeffrey St. Clair
High Plains Grifter: the Life and Crimes of George W. Bush
Patrick Cockburn
Kurdish Fighters Always Feared Trump Would be a Treacherous Ally
Paul Street
On the TrumpenLeft and False Equivalence
Dave Lindorff
Sure Trump is ‘Betraying the Kurds!’ But What’s New about That?
Rob Urie
Democrats Impeach Joe Biden, Fiddle as the Planet Burns
Sam Pizzigati
Inequality is Literally Killing Us
Jill Richardson
What Life on the Margins Feels Like
Mitchell Zimmerman
IMPOTUS: Droit de seigneur at Mar-a-Lago
Robert Hunziker
Methane SOS
Lawrence Davidson
Donald Trump, the Christian Warrior
William Hartung – Mandy Smithburger
The Pentagon is Pledging to Reform Itself, Again. It Won’t.
FacebookTwitterRedditEmail