Bolivian President Morales is not socialist

Updated: 21 May 2008, 23:21

Originally written: 01 February 2006

The National Post has been writing a lot about the election of “socialist” Evo Morales as president of Bolivia. Morales has said that he intends to nationalize the oil and natural gas reserves in Bolivia. Nationalization of industry is, according to non-socialists, a “socialist” measure. Morales probably agrees with that characterization. Capitalism’s Gravediggers does not.

Nationalization is simply a policy of giving the government — the executive of the state’s capitalist class — the direct power to better serve the country’s non-oil capitalists. Assuming that there are very few oil capitalists in Bolivia, this nationalization will benefit the majority of Bolivia’s capitalists. Any profits are intended to stay in Bolivia to enrich Bolivia’s capitalist class. This assumes that Morales, with any assistance he receives, will be able to manage the oil industry profitably.

Morales has pledged that his nationalization will not be an expropriation of assets of the current oil capitalists (Bolivian and foreign). He has not clarified his specific intentions. That uncertainty brings discomfort to the oil capitalists. Morales’ reluctance to clarify his nationalization scheme, may simply be designed to increase and lengthen that discomfort to increase his power versus the oil capitalists.

It sounds as though Morales intends only to skim the top off of the oil profits, but continue to permit the oil capitalists to profit. If that is the case, when and if Morales does nationalize the oil companies in some way, the oil companies probably will not risk that profit by drastic action or retribution.

The oil capitalists will wait out this left wing presidency, hoping that future governments will take less of their profits. But governments of capitalism, from the supposedly socialist to those who will appease the capitalists at almost any cost, do not, and will not forsake oil profits. Whether they use taxes, confiscation or some other form of nationalization, or graft, the government or its leaders will acquire some of those profits.

Morales is very likely to be seen by Bolivians as a great patriot for any action he takes to provide local benefit at the expense of the international oil companies. If Morales is a smart man, or listens to smart advisors, he will not much change the short term or long term management of the oil companies. He will simply take a cut of the profits, by whatever method seems best to him. Any method is just some form of a tax. And there are extremely few governments anywhere in the world, of any political stripe, which renounce taxes.

Even if Morales does expropriate the oil companies Bolivian holdings and capital, he will continue to have them run to produce profits. The management could be good or bad, but the intent will be profit. So Capitalism’s Gravediggers does not see a big difference between the supposedly socialist Bolivia, and any other oil producing country. All of them embrace the profit system: capitalism.

It is not far-fetched to expect that the Bolivian government will try to increase oil production. The currently popular reason for such an approach is that it will be good for the country and good for those who will be employed in the oil industry. It would also increase the profits of the oil companies.

The allegations of socialism are far-fetched. Morales has a capitalist economy to run, and whether it is run poorly or run well, it is still capitalism. Almost every country on the planet exercises some form of control over some industries. The United States — the self-styled shining beacon of capitalism — nationalizes industry when the government believes it is good business.

Socialism is a fundamentally different approach to production: production for use instead of profit. Socialism means a society of production without profit in a society in which buying and selling (including employment) will be obsolete concepts.

The new government of Bolivia has no intention of production without profit, because it is a government of capitalism, for capitalism. Morales will no doubt try to improve the lives of all Bolivians. Hopefully he will succeed. Most “democratic” governments of whatever flavour of capitalism they support, sincerely want to improve the lives of all the state’s citizens. They just choose slightly different approaches.

No matter how much a particular method of managing capitalism is alleged to have improved the lives of the majority, it is not enough because there is a much better approach. We can replace capitalism with socialism and remove the restrictions to satisfying human needs inherent in production for profit.

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