Venezuelans oppose Chávez attempt to nationalize private food company

By Juan Forero
Washington Post staff writer
Friday, July 9, 2010

As in all major government takeovers of private companies in Venezuela, President Hugo Chávez declared that seizing beer-and-food giant Polar's facilities here would mark another victory for the poor in the country's march toward socialism.

"Why is it that Polar has so much money?" Chávez asked in a February speech made in this city in northwest Venezuela. "I say to the owner of Polar: Start making plans, because you are going to be out of here."

Weeks later, a decree expropriating Polar's warehouses and offices in an industrial zone of Barquisimeto was signed. And Venezuelans, after nearly 12 years of state interventions under Chávez, expected the government to quickly sweep the company's facilities in the country's fourth-largest city from their current location and replace them with apartments. Chávez suggested that he might even nationalize the entire company, which has plants and distribution points nationwide.

Except this time, the president's plans went badly awry, exposing mounting national opposition to a policy under which oil companies, supermarkets and factories have been taken over by the state, only to founder under the control of government functionaries.

Not only did Polar fight back by taking its case to the Supreme Court, but its employees have risen up, too, rallying in opposition to Chávez's edict and holding all-night vigils to prevent a takeover. Among those who joined the uprising was Henri Falcón, the popular governor of Lara state, a former ally of Chávez's who says the president has not considered long-term consequences when nationalizing companies.

"The president arrives and it occurs to him to say, 'This has to be expropriated,' without taking into account the technical or legal criteria," Falcon said in an interview last week. "We oppose this because it does not make sense. It is more an impulse of the president."

The government has characterized the struggle with Polar as one between good and evil, with Chávez giving several speeches in which he has mocked Polar's owner, Lorenzo Mendoza, who is one of Latin America's richest men.

"We will see who can last longer, Mendoza, you with your millions or me with my morals," Chávez said in a nationally televised speech in June. "Because you are the rich one. You are going to hell, to heaven you will not go."

The president has also called on workers to rise up against the elites. "I invoke the real Venezuelan working class for economic war against the bourgeoisie," said Chávez, who directly warned Mendoza that he could nationalize the entire Polar company, which accounts for 2.4 percent of the country's non-oil gross domestic product and is the country's largest private company. Its polar bear logo is well-known throughout Venezuela and other countries.

Mendoza, 44, has not publicly responded to the attacks, and Polar officials declined to comment about Chávez's efforts to nationalize the installations in Barquisimeto.

But employees said they oppose the government intervention because they think workers have fared badly at nationalized companies, where they have faced reduced wages and been unable to bargain collectively.

"At no time have we been taken into account and asked to say if we agree," said Richard Prieto, head of one of the two unions that represent more than 800 workers here.

Workers also said Polar offers wages and benefits that far outstrip those of other employers in Venezuela, including the state.

"We are saying no because we have seen the experiences of other expropriated companies," said Juan Tacoa, president of the other union. "Here in Polar, we have benefits we know we would not have with the government."

The stand taken by the workers has gone beyond the metal gates that surround the facilities from which the company distributes beer, wine and other beverages. A poll by Consultores 21, a Caracas firm, showed that 84 percent of the residents of Barquisimeto oppose the takeover. Nearly 70 percent said they thought the government would never build housing for the poor on the site, which is what Chávez says he envisions once Polar is removed.

The revolt against the president's plans has been particularly embarrassing because it has come during a roiling scandal involving the state's mismanagement of food distribution. Over the past two months, tens of thousands of tons of imported food bound for state-subsidized markets has been found rotting at ports and in warehouses. Petróleos de Venezuela, the state oil company, was responsible for distributing the food, which included chickens, cereal and powdered milk.

Food production has fallen precipitously under Chávez, while imports have sharply increased. Food scarcity and high prices have become nagging realities, which recently prompted the government to nationalize a string of supermarkets.

Polar, meanwhile, has grown in recent years into a behemoth that employs 30,000 workers and operates 14 plants and 75 distribution centers in Venezuela. Since Mendoza's grandfather founded the company in 1941, it has expanded to produce everything from beer to butter to cooking oil to mayonnaise. Its most famous food product is the popular precooked flour needed for the cornmeal cakes that are a national staple.

"It's a company like Kraft or Procter & Gamble which sells a lot of staples, things that people use," said Robert Bottome, editor of VenEconomía, a Caracas business journal. "And it has a tradition that goes back 60 years of maintaining quality and treating its customers well and its workers well. It should be a model for what all companies should be. Sounds corny, but that's the reality of it."

Last week, workers played dominoes and ping-pong as the sun went down -- another night approached in which they would make sure Chávez's supporters did not storm the gates.

Big wooden pallets blocked entrances, and banners that were draped on fences and walls read "Polar is everyone" and "You're not alone." A bus filled with workers from another Polar facility arrived to help.

Taking a moment from playing dominoes, Santos Freites, 42, who helps load trucks, said he had worked all day, gone home to eat and was now ready to settle in for nine more hours.

"This is our fight, our cause, and the reason we are here is our jobs," he said. "We are here because we need to defend our jobs, for our children and our families."

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