Originally published at: https://boingboing.net/2019/11/04/why-did-venezuela-collapse-wa.html
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They need more Jack Ryan, I think…
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Well, it also has a lot to do with the Venezuelan oligarchy being willing to burn the country (and many? a few? of their own assets) to the ground before submitting to “socialism” (read: democracy).
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Right now the “socialists” and the oligarchs burning the country to the ground are the same people.
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The video mentioned is far from excellent, it is naive if not an insult. The current situation in Venezuela is a consequence of several years of mismanagement by Chavez and Maduro. Where productive farmers were driven from their land, oil money was used to buy and build an AK-47 factory to arm pro-government militias and retrofit the armed forces with weapons unsuitable for the region’s type of war and climate ( Why a S-300 Rocket System). Almost all air force planes are grounded. The international Bolivarian TV network was just a mind-washing machine. And one of the regime’s first acts was to get rid of the independent press. It was and is a populist authoritarian regime, never democratic with social concerns.
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Sigh. If only U.S. attempts to overthrow yet another government and install its own compliant, handpicked puppet had succeeded. 
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It is a short video, not meant to fully explain the intricacies of the government mismanagement over the last 20 years. It does a good job pointing out that when Venezuela’s current situation is borne of oil prices falling and government corruption and authoritarianism. While certainly not a complete explanation, it is a far better short explainer than anything I’ve seen on American TV.
Is there a different short (under 10 minute) video that you would recommend instead?
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My longstanding hunch is right; it all started to head south there when the price of oil headed in the same direction. What this video did open my eyes to was the corruption and the authoritarian nature of Maduro and his buddies.
Currency exchange is officially 10 to 1, but black market is 12000 to 1? That’s one heck of a profit motive. Profit motive… hmm… greed, something about the root of evil.
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Here’s part of an explanation re the current situation, at least, on the PBS New Hour, and the video segment is 1 minute and 3 seconds long:
This NY Times (thank you @UUbuntu for correction) explainer covers the currency crisis, it’s 9 minutes and 42 seconds long:
Professor Steve Hanke, one of the world’s leading experts on hyperinflation and former adviser to Venezuela’s former President Rafael Caldera, says dollarisation is the only way to get out of the hyperinflationary spiral. That’s after the President devalued the currency by 96% and pegged it to the state-backed cryptocurrency the petro. He also raised the minimum wage by 3500% as the country faces an economic malaise, a migration crisis and political instability.
ETA: correction re source of second video
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Impeach Jordi Molla!
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I found this series informative:
ETA - not sure if this goes to the proper play list or not…
Venezuela here:
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The authoritarianism wasn’t necessarily why it collapsed, there had been some long standing factors that had been decades in the making. The country’s over reliance on oil production made the country plenty rich but didn’t equally create job opportunities, there’s only so many people you can hire within the oil industry after all. Because of this there was kind of a stagnation with jobs and job opportunities, the government also heavily subsidized gasoline and food to be incredibly low, so by the time Chavez came around promising to shake things up he fired everyone in the oil industry that voted against him causing the beginning of the end because the country suddenly wasn’t making as much money, which caused inflation to go out of control and they could no longer effectively subsidize goods as they could before.
This is without even bringing into the picture the naked corruption of looting of the country. In the US Venezuela is used as a prime example as to why socialism won’t work, which… sure… but it failed because every single person in charge at every level has used their position to further themselves. That’s not a failing of socialism but abuse of power and utter lack of transparency and checks & balances.
I haven’t seen the video just yet but figured i’d post up my thoughts on what i personally grew up seeing, there’s probably more factors that i’ve missed.
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Problems with the video:
It states that thanks to Chavez poverty rates went down. Technically true but what was going on was that he was using social programs to essentially bribe lower class people into participating with the understanding that they were obligated to support Chavez or be completely cut off so the numbers on poverty reduction were being manipulated.
Also states that education improved. Hugely untrue as Venezuela prior to him taking power had one of the best education systems in the world, him taking over he changed curriculum to be less stringent and focused more on essentially re-educating the youth into buying into socialist ideals and political propaganda.
Health System being improved. Also untrue, once he took power he actually had a deal with Cuba to bring over Cuban doctors which made healthcare less reliable, not to mention blacklisting professionals that spoke against Chavez. The system was so bad that he didn’t trust to get his cancer treatment done in Venezuela and had it done in Cuba, which thankfully led to it relapsing and causing his death.
Rest of the video seemed alright though it was pretty light on the sustained corruption from Chavez day 1, and how the treasury was looted by his family upon his death. Doesn’t really cover why Maduro is considered to be an illegitimate president.
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As mentioned by others, the video is not bad, but a bit incomplete. But I have to take a time to basically contradict the main point of the post. No, the situation of Venezuela has a lot to do with socialism.
What is absolutely wrong is to say stuff like ANY and ALL “socialist” (quotes because lets include here stuff like is just, well, to the left of rabid capitalism) will inevitably lead you to being like Venezuela. But that, being true, doesnt hide the fact that the particular way that authoritarianism came and expressed itself in Venezuela is heavily influenced by (some) socialism. Of course, one of the main problems is that what the ruling caste of Chavismo thinks is socialism is… well, they arent the sharpest tools in the shed, so it is a primitive, irrational, stupid form of “socialism”.
But again, you cant discount it just because it is bad. If you want an US analogy, think of the Orange Idiot trade war. It is “capitalism” as understood by a defective childish mind of an authoritarian idiot. But that is important becuase it is the way it is going to hurt you. He will channel his idiocy toward what his non-functioning brain thinks is capitalism. Well, the Chavistas have been enjoying much more unrestrained power for 20+ years to implement what their stupid militaristic authoritarian idiotic minds consider “socialism”, and the particular economic measures that have destroyed the country are related to that worldview. If they had, say, a neoliberal one, they would have screwed up the country too, but in a different way.
As mentioned by Grey_Devil, for example, when almost whole world left was praising the “revolution” for the “reduction of poverty” during Chávez, most of us in the know could, and did, tell anybody interested that it was a fraud. It was just riding an oil boom and using the money in the most inefficient and corrupt way that yes, ended up “lifting” people out of “poverty”, if for that you understood they were still as poor as before but now had a ton of “free” stuff given (to the tune of at the bare minimum every dollar given being matched by a dollar stolen…). Lots of us could, and did, tell anybody that it was not sustainable, that the money wasted was not put into real development that would have meant helping the poor become productive people living on their own work - something that on the “socialist” Chavista thinking was anatema because in one hand “we are rich and every Venezuelan deserves his oil money quota” and on the other having them depending on government largesse was a sure way to keep them compliant and voting for them. Right now that mentality has been replaced with being famished and depending on the government to give you a tiny bit to eat is also good to keep people in line.
As somebody else said about them, to get to where Venezuela is you need evil, incompetence and socialism. The first 2 are absolutely necessary. The third is not, but is going to be the way they channel their evil and incompetence and the filter they see the world with. Again, a very crude form of socialism, but still, cant deny it. If it was evil, incompetence and capitalism the disaster would have a different shape.
The other thing, of course, is that while it is perfeclty true and logical to say that no, any and all roads to socialism dont end on Venezuela… well, lots of people applauded all this because it was “socialist”, lots of people now dont want to talk against it for the same, and some still keep crowing the same idiocies. Like that it is the “oligarchs” fault, not the red saints. Of course, for the Chavistas, EVERYBODY not applauding them and thinking Chávez is the second Jesús is an oligarch…
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Thank you, I particularly appreciated the second (explainer) ink, and I found it helpful.
I wasn’t a fan of the first interview. Perhaps because of my childhood in Apartheid South Africa, I tend to be suspicious of short interviews with former heads of secret police forces.
The second (explainer) piece was an IGTV segment (not NY Times explainer), and is only a 10 minute interview with Steve Hanke, a libertarian economist from the Cato Institute. And while his general explanation of the causes and effects of hyperinflation is excellent, his foray into the political reasons for the crisis sounds like a defense of imperialism. When he blames the crisis “solely the fault of the Maduro regime” and says “The dustbin of history is filled with socialist economies that have completely collapsed”, he moves away from applied economics, and moves into promotion of a pretty specific political ideology.
IMO, a better PBS segment on the area is this one: https://www.youtube.com/watch?v=pnU2Ov_4fSk (8 minutes), where the narrator discusses the core support for Maduro and why he remains in power despite hyperinflation and sanctions. It doesn’t talk much about the reasons for the economic crisis, but spends more time discussing its effects on the people and why despite the hyperinflation and widespread corruption, so many of the poorest people in the country will defend the Maduro regime.
I still think that the Vox Explainer is the best of the short videos presented here, as it talks about the causes and effects of the current situation there. As said before, it’s certainly not complete, but it seems far less ideologically tilted than the other videos I’ve seen.
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It’s neither short or a video, but I find the articles on Venezuela at libcom.org taught me a lot without siding with Chavismo or capitalism (libcom being opposed to both).
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The “so many” are estimated, right now, about 20%. And that may even be inflated.
And sorry, but the fact that the idiots at Cato say something does not make it not true (broken clock, etc); the fault is 100% on Maduro and Chávez before him. 20 years of increasingly more absolute power dont leave much room for anybody else to be responsible. The rest is yes, just their ideological spin, but that is very much true. 2 or 3 years in the beginning of this they could get away with the “inheritance” excuse; right now, no.
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The videos does not even touch on the terribly failed Chavista socialist economy.
Basically any businessperson is exploiting people and everything derives from this idea.
So, for instance, they went ahead and nationalized many sugar factories, many of which, through corruption and incompetence, would end up closing down. So sugar would have to be imported instead of bought locally.
Similarly, small producers were forced to sell below cost. So they ended up closing down their, say, chicken farms, and fleeing the country (it is basically illegal to shut down your business, witch prison sentences of up to 15 months). And again, chicken would have to be imported.
And this simplistic anti-capitalism would drive local production to a halt.
You’d think I’m making this up, so here’s some links:
Article 539 of Lottt law:
“El patrono o patrona que de manera ilegal e injustificada cierre la fuente de trabajo, será sancionado o sancionada con la pena de arresto de seis (6) a quince (15) meses por los órganos jurisdiccionales competentes a solicitud del Ministerio Público.”
The employer who illegally and unjustifiably closes the source of work shall be sanctioned with the penalty of arrest from six (6) to fifteen (15) months by the competent jurisdictional bodies at the request of the Public Prosecutor’s Office.
https://www.actualidadlaboral.com.ve/seccion/detalles/si-cierras-tu-empresa-vas-preso
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There have been a number of thugocracies who cover themselves with a veneer of “socialism”.
This does not say anything about whether or not socialism is a good system.
It does, however, say a lot about the gullible intellectuals in the USA and Europe who believe the veneer for years, until it finally falls away and the thug beneath is revealed.
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You can be against heavy-handed and destructive US intervention, and against Chavistas’ corrupt, inefficient “socialist” regime that’s been driving the country into the ground for years.
It’s the same thing I’ve seen from old lefties reflexively supporting Putin’s regime in Russia: “US is Bad, these people are opposed to the US and the US says they’re bad, therefore they must be Good.” Unfortunately having left-leaning political beliefs does not make you any better at avoiding groupthink and falling prey to propaganda.
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