BUSINESSWEEK ONLINE : DECEMBER 11, 2000 ISSUE
INTERNATIONAL -- LATIN AMERICAN BUSINESS Speak Softly and Carry a Referendum (int'l edition) Chavez rallies voters again--this time, against corrupt unions For a peaceful revolution, there sure have been a lot of casualties. Opposition political parties, the Supreme Court, Congress, and the constitution--all have fallen victim to President Hugo Chavez' crusade to rid Venezuela of corruption and cronyism. The former paratrooper's weapon of choice is not the rifle but the referendum. Now, Chavez is aiming it at the country's labor unions. On Dec. 3, Venezuelan voters will head to the polls--for the sixth time in two years--this time to decide the fate of the country's notoriously crooked unions. If the referendum is approved, the four labor confederations, which represent 20% of Venezuela's total workforce, will be forced to select their leaders via direct elections rather than through backroom negotiations. Chavez' obvious goal is to replace old-style union bosses with his own sympathizers. Indeed, critics contend that the upcoming plebiscite, like those that preceded it, is nothing less than an attempt to lend democratic legitimacy to the President's autocratic maneuvers. ''He's bypassing the institutions, which is very dangerous--and very seductive,'' says Carmen B. Fernandez, director of DataStrategia, a Caracas polling firm. True, Venezuela's constitution expressly forbids government intervention in union affairs. But Chavez, with the support of two-thirds of the electorate, knows he has public opinion on his side. Union bosses are widely seen as corrupt. ''I want to get those people out of there,'' says Argenis Graterol, 30, a shift supervisor at a state juvenile reform school in Caracas, who plans to vote ''si'' on Dec. 3. ''They represent their own interests more than the workers.'' Venezuela's labor confederations have long been closely allied with Accion Democratica and COPEI, the two parties that ran Venezuela for more than four decades until Chavez' landslide election in December, 1998. Union leaders often double as congressmen and enjoy lavish lifestyles. Their days of living large may be numbered, though. If, as most analysts expect, the upcoming referendum is approved, the union confederations will be required to hold their first-ever elections within 180 days. Members of the Bolivarian Workers Force, a labor organization affiliated with Chavez' Fifth Republic Movement, are expected to vie for several of the top posts. ''The only thing that's being done is changing the party,'' says Juan Calvo, vice-president of Venepal, a leading Venezuelan paper manufacturer. Chavez' hardball tactics have drawn fire from the International Labor Organization. The Geneva group says the referendum violates ILO conventions that Venezuela has signed. Legal attempts by the country's unions to have the plebiscite quashed on grounds that it is unconstitutional have failed, however. SELLING JOBS. Union leaders argue that reform should come from within. ''Everyone's in agreement that the union movement has to be changed,'' says Carlos Navarro, secretary general of the Venezuelan Workers Confederation, the biggest grouping, with some 1 million members. In fact, some unions have already moved to institute direct election of leaders by the membership base, as well as term limits for top officials. Still, questionable practices persist, such as selling jobs and making employment contingent on party affiliation. Business does not have a direct stake in the outcome of the referendum, since it is largely government workers that are unionized. Yet companies fear that if Chavez' left-leaning supporters gain control of the unions, they may lobby for--and win--a return to the costly severance pay scheme that existed until 1997, as well as more generous social security benefits. ''What happens to severance pay and pensions are things that go straight to [companies'] bottom line,'' says Robert Bottome, director of VenEconomy, a local consultancy. One thing seems sure: Chavez will continue to indulge his mania for referendums, particularly on issues where he has the backing of the impoverished majority that is the bedrock of his support. Land reform could be one such issue. The President often rails against big landowners, urging them to turn over idle land to the poor for farming. A referendum to do just that would win handily. If this keeps up, Venezuelans may soon begin exhibiting the symptoms of a rare disorder, voter fatigue. By Christina Hoag in Caracas _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ BACK TO TOP					RELATED ITEMS Speak Softly and Carry a Referendum (int'l edition) TABLE: Venezuela's Election Fever INTERACT E-Mail to Business Week Online

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