The Importance of Wages for the Millions of Working Venezuelans

By Pasqualina Curcio – May 10, 2021

There are those in Venezuela who dismiss the salary issue as if it were not relevant, as if it were just one more aspect among many other issues. They lightly convey the message that as long as we continue to be besieged by the US there is not much that can be done to adjust them to decent levels.  They do not propose solutions and in response to requests for wage increases the answer is: “you cannot distribute what does not exist, you have to produce, and for that you have to work,” as if we do not do that every day.

We are almost 14 million active workers in Venezuela who live, I repeat, live, on a fortnight’s salary. 92% of the employed populations of this country, according to the latest INE data, belong to the salaried class, of which 3.3 million of us work in the public administration. Five million pensioners also live on the legal minimum wage. We total 19 million people, something like 63% of the population. The other 37% of the population includes children under 15 years of age, that is, our offspring, plus approximately one million unemployed people, and some 347,170 people who, according to INE figures, are employers, that is, they belong to the other class: the bourgeoisie.

Wages are important not only because they affect the life and quality of life of a great number of people here in Venezuela, and in the whole world, who depend on them, but also because, given the original accumulation of capital, and within the framework of the social process of labor, they determine the great inequalities that result in poverty, injustice, hunger, and misery. To understand why 1% of the world population appropriates 82% of what is produced, which by the way is produced by the worker, is to analyze how wealth is distributed in the social process of labor itself, and therefore how this product is distributed between salary, I repeat, salary, and profit. It is not by chance that one of the first postulates of neoliberalism has been the freezing of wages and the liberation of prices, which is nothing more than the purpose of increasing profit, this being the difference between the price and the wage.

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The issue of wages is not just any issue, it is central. Dismissing it by repeating monetarist dogmas and affirming that there is no money to adjust them when in Venezuela the degree of exploitation/profit has increased 270% in less than four years, while the legal minimum wage does not even cover 0.65% of the minimum material needs of the working class, This is not only paradoxical in a discourse in which the word “socialism’ is constantly mentioned, but it also reflects a worrying lack of knowledge about the ever-increasing inequality between wages and profits in our country, as well as a lack of respect for the high level of consciousness of the Venezuelan working class, vanguard in the anti-neoliberal struggles since 1989.

In neoliberal times, during the Fourth Republic, specifically between 1978 and 1998, the real salary or purchasing power of Venezuelan workers fell 65% despite the fact that national production increased 30% during the same period. At the same time, during those 20 years, dark moments in our economic history, the degree of exploitation of workers by the bourgeoisie increased 205% (BCV data).

Since 1999, with the arrival of Comandante Chávez and the Bolivarian Revolution, these tendencies were reversed: between 1999, and more specifically 2003 and 2013, the real salary or purchasing power increased 77% and the degree of exploitation decreased 38%. During that period the economy grew 68% (BCV data). In the transition towards socialism, Chávez hit the core of the capitalist mode of production, to distribute in a less unequal way, between the worker and the bourgeoise, the value added in the production process. The objective was to decrease the gap between salary and profit and therefore, the inequality in the distribution of what was produced, which in turn was reflected in a 57% drop in poverty in our country. This was achieved, first, by bringing the legal minimum wage to the levels of the food basket. Second, by controlling the prices of essential goods (food, medicines) whose production was in the hands of large private monopolies. Third and very important, especially in inflationary economies like ours, by adjusting the legal minimum wage whenever prices varied.

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In 2013 imperialism intensified the economic war against the Venezuelan people. Among the weapons it has employed is the attack on the bolivar through the political manipulation of the exchange rate, which has derived in an induced depreciation of the bolivar in the order of 3.1 trillion percent from 2013 to date, and an increase in prices, also induced, of 63 billion percent during the same period. The point is that, in this scenario, the increase in nominal wages has lagged behind that of prices, they have only increased 5 billion percent which has derived in a 99% drop in the purchasing power of the working class as opposed to an increase in the degree of exploitation/profit in excess of 270% in less than four years (between 2014 and 2017, surely higher up to 2021).

In 2014, of all that was produced in Venezuela, 36% went to the 13 million wage earners, while 31% went to the 400,000 employers. In 2017 (last figure published by the BCV) only 18% was distributed to the 13 million workers, while the 400,000 members of the bourgeoisie appropriated no longer 31% of the production but 50%, or half.

Not only is 64% less being produced with respect to 2014 mainly as a consequence of imperial aggressions, but the little that is being produced is being distributed more unequally between wages and profits reflecting in a deterioration of the quality of life of the workers at the cost of greater exploitation, which has been a consequence of the lag of nominal wages in the face of the more than proportional increases in prices. It is this inequality in the distribution of national production that apparently is not known or understood by those who dispatch the wage issue lightly. It is a matter of how production is being distributed, even if it is less. Not to mention that, with purchasing power tending to zero, it will be complicated, if not impossible, to increase production.

Venezuelan workers deserve, because of our high and more than proven class consciousness, a high-level debate on this issue. We are not satisfied with repetitions of dogmas, in a monetarist fashion, that seek to justify the non-increase of wages without providing any solution. How good it would be if, in the parliamentary agenda, with a revolutionary majority, priority and importance were given to the issue of wages, which affects 99% of the population (27 million Venezuelans including our offspring) above the debate about the best concessions we could offer to a microscopic group of foreign private capitalists to come and “invest” in areas full of natural wealth especially arranged for them.

 

Featured image: File Photo

(Resumen Latinoamericano-English)

Pasqualina Curcio
+ posts

Economist (Central University of Venezuela). PhD in Political Science from Simón Bolívar University (Venezuela). Master in Public Policies of the Institute of Advanced Studies in Administration (Venezuela). She is a Full Professor of the Department of Economic and Administrative Sciences of the Simón Bolívar University. She was Deputy Minister of Collective Health Networks.

Pasqualina Curcio

Economist (Central University of Venezuela). PhD in Political Science from Simón Bolívar University (Venezuela). Master in Public Policies of the Institute of Advanced Studies in Administration (Venezuela). She is a Full Professor of the Department of Economic and Administrative Sciences of the Simón Bolívar University. She was Deputy Minister of Collective Health Networks.