By the People, for the People?

by Amira Valliani:

Jesús Luongo, General Manager of the Paraguaná Refining Complex (CRP), prefers to boast about how his employer, Petróleos de Venezuela, Sociedad Anónima (PDVSA), gives back to the community over talking about operations at CRP, the world’s largest oil refining complex.

“This social development is not a cliché—we really mean it,” he said, beaming with pride. And it shows: his presentation on social projects supported by his refinery is complemented by posters plastered everywhere as well as buttons on each employee’s shirt that read La Roja Rojita. Roughly translating to “The Reddest of Red,” the phrase has come to symbolize the Venezuelan national oil company’s dedication to advancing the prosperity of its country’s people.

The unofficial motto was born in 2006, four years after a countrywide strike in which Venezuelans protested against President Hugo Chávez. Among the broad coalition of civilian strikers were countless PDVSA employees, their absence from work crippling company operations for 63 days. While Venezuelans waited for hours just for a tank of gas, the country’s oildependent economy screeched to a halt. When the strike ended, about 19,500 PDVSA employees either were fired or quit, depending on the source. Luis Vierma, the company’s Vice President of Exploration and Production, described the drop in employment as a result of the employee’s own decisions, adding that he was stunned and disheartened “that some of [his] friends would decide to leave.”

The strike restructured PDVSA entirely—in both mission and personnel. Beyond replacing thousands of employees, the corporation became what they consider a new company altogether: La Nueva PDVSA. The new PDVSA came to pride itself on the fact that it uses its profits to finance and manage social development projects. It works towards improving the lives of those whom Vierma describes as their true “stockholders”: the Venezuelan people.

In 2006, Rafael Ramírez, the president of the company, declared in a private meeting with PDVSA executives that “la Nueva PDVSA is roja, rojita.” He further stated that “we support Chávez , who is our leader, who is the greatest leader of this [Bolivarian] revolution…And for those who does not feel comfortable with this position, it is necessary that they cede their positions to a Bolivarian.” Opposition leaders leaked a tape of this meeting to the media, convinced that Venezuelans would be indignant with PDVSA’s political discrimination tactics. But the ploy backfired: instead, many Venezuelans embraced the phrase, proud that the oil company that for years had ignored the impoverished now recognized them and was serious about helping them.

Because PDVSA plays such a large role in both Venezuela’s economy and the lives of the Venezuelan people, the company’s strong connection to the Venezuelan government certainly cuts through bureaucracy when coordinating corporate and government policy. The two are so closely tied that PDVSA is not only state-owned, but Ramírez, the company’s president, also serves as the country’s Minister of Energy and Petroleum, almost guaranteeing that corporate and government negotiations run smoothly. Francisco Gammara, former drilling manager in the PDVSA Western Region and a PDVSA employee for 22 years before the strike, is one of those who, according to Ramírez, “ceded” his position at PDVSA. Though Gamarra opposed the strike, he was a victim of the backlash it caused. He explained that employees became politically isolated only after the birth of La Nueva PDVSA: “Before the strike, we could be involved in politics, but in our free time on weekends, without involving the name of PDVSA.”

Though the strike was well-supported by the populace at first, Gamarra continued, the government changed public opinion by isolating oil executives, “pointing to the oil people as the ones that were against a government that was defending the poor people’s social benefits.”

“We run a democracy,” Vierma responded. “Everyone can think as they please.” Nevertheless, the walls of the lobby at PDVSA headquarters in Caracas are covered with giant pictures of Ramirez and fellow employees at rallies, with giant taglines that read Patria, Socialismo, O Muerte—“Patriotism, Socialism, or Death.” So, while employees might be able to think as they want, it may be hard to not do as PDVSA says.