For much of the 20th century, Venezuela was the poster child for the successful South American republic—that is, democratic when its neighbors were despotic, and prosperous when its neighbors were poor.
It was the wealthiest Latin American country, and it’s now the poorest, after its adoption of communism and one-man rule.
How could a country sitting atop 20% of the world’s known oil reserves, with developed infrastructure capable of pumping and shipping out millions of barrels of oil a year, become the impoverished, suffering mess that is Venezuela today?
It happens after a country suffers a systems collapse, as Venezuela had following the 15-year reign of the now-deceased communist President Hugo Chavez.
Chavez was elected president in 1998 after promising to end corruption and improve living conditions for the poor. He used the same tired slogans—“wealth gap” and “income inequality”—that were so effectively used by Mao Zedong and Fidel Castro before taking power in China and Cuba.
The majority will always vote for everything to be free—that is, until the goose that lays the golden egg is killed; in this case, the investors who were driven out of the county.
Stories by American journalists hailing Chavez as a representative of the poor helped him gain power.
Chavez’s election was welcomed by many members of the U.S. media, including Larry Rohter, bureau chief of The New York Times in South America.
On July 28, 2000, Rohter wrote a column about Chavez, which included the following:
For the Latin American left, hungry for a homegrown hero, Mr. Chavez is a godsend, a charismatic military man who condemns capitalism and promises social justice.
An orator who is, by turns, spellbinding and funny, Mr. Chavez has gathered the poor into a powerful force that is demanding change.
Unlike Castro, Chavez never tried to hide his communist sentiments, even as he referred to his movement as “humanist.” He spoke with admiration about Castro and Arab leaders, such as Saddam Hussein and Muammar Qaddafi, and soon reached out to leaders in China, Russia, and Iran.
Chavez promised a peaceful social revolution that would usher in a golden age for Venezuela. He failed to deliver either prosperity or equality and immediately labeled the Venezuelan Congress and Supreme Court corrupt and expanded the military’s role.
He nationalized hundreds of private businesses and foreign-owned assets, such as oil projects run by Exxon Mobil and Conoco Phillips, gutting the country of crucial technical expertise.
With the international companies withdrawing from their Venezuelan operations and inexperienced, incompetent government appointees replacing company managers, engineers, and other experts, production plunged to new lows.
He set up cooperatives in place of businesses that served as “grab bags” for the takers, not the producers.
Chavez initiated price controls intended to make essential goods more affordable for the poor by capping the price of flour and cooking oil. Many Venezuelan companies stopped production because the price controls made them unprofitable, in the process increasing prices.
He stacked the country’s courts with political allies, passed laws restricting the ability of journalists to criticize the government, and consistently sought ways to do away with checks on his power.
He expanded the power of the presidency, effectively took control of the Supreme Court, harassed the press, and jailed or eliminated political opponents. In speech after speech, he attacked business, opposition politicians, and media leaders who questioned his methods and objectives, calling them degenerates.
When Catholic bishops spoke out against him, he called them “evils in vestments.”
The Human Rights Watch of the United Nations issued a report in 2008 critical of Chavez’s human rights record. It claimed that he manipulated the country’s courts and intimidated the media, labor unions, and civil society.
As ambassador to the Organization of American States from 1981 to 1985, I was often asked about Chavez and his communist leanings before he came to power.
In 1983, Chavez was a teacher at the Military Academy of Venezuela with a reputation for rousing lectures and political criticism of the government. He began to travel the country, recruiting new members for his leftist military movement.
I warned my friends in Venezuela not to support the socialist-Marxist system that Chavez proposed, including reducing income inequality, wealth redistribution, and the other usual communist slogans that have so much initial traction, especially among the poor living in the Punceres outside of Caracas, the nation’s capital.
Unfortunately, my warnings about Chavez’s friendship with Castro were not taken seriously by some of my Venezuelan friends and several OAS members. The descriptions of my relevant China and Cuban experiences usually fell on deaf ears regarding Venezuela.
I was told that Venezuela’s prosperous civil structure was too entrenched to be vulnerable. I hear the same words today from well-meaning friends about the U.S. economy. It could happen here, too.
Chavez announced in 2011 that he was being treated for cancer. Two years later, he said his illness prevented him from continuing to serve as president and recommended Vice President Nicolas Maduro as his successor.
When Chavez died on March 5, 2013, Maduro campaigned on a promise to carry on the socialist-communist Chavez’s legacy. He barely edged out opposition candidate Henrique Capriles, taking just 50.6% of the vote, amid civil society reports of electoral fraud.
Maduro was not lacking in leftist convictions of his own. He studied in Cuba, was a member of the super-left-wing Socialist League, and worked as a union negotiator before joining electoral politics in Venezuela. The Castro government allegedly planted Maduro as a mole in the emerging Chavez government.
As Venezuela’s economy has collapsed, Maduro’s popularity has also plummeted, and protests have rocked the country. More than half of his support comes from the slums, or barrios, of Venezuela, where half of the population lives.
He has reacted to the chaos and dissent with authoritarian tactics. In 2016, he blocked an attempt to hold a referendum on whether he should be recalled. In March of last year, his loyalist-stacked Supreme Court dissolved the opposition-controlled legislative branch and took its power. He also violently cracked down on protests and imprisoned major political rivals.
Hyperinflation set off the most recent and precipitous descent. The peso, which had traded on parity with the U.S. dollar 30 years ago, is today a millionth of a dollar.
Unbridled government spending and uncontrolled monetary expansion have left Venezuela in economic free fall.
The State Department said that 93% of Venezuelans are living below the poverty level, and the income of $3 to $10 a month is not enough to pay for adequate food and medicine for families and children.
Some 20% of the population has left the country because of the impoverished conditions and tyranny. Water shortages are endemic, blackouts are common, and the health care system has collapsed. Diseases such as diphtheria and malaria, which were all but eradicated decades ago, are back.
Maduro is scrambling to cling to power as an unprecedented economic crisis batters his country. Since 2017, he has been tossing political opponents in prison, cracking down on street protests with lethal force, with government security forces killing demonstrators.
Venezuela’s economic and political crisis reached a level of international emergency as opposition leader Juan Guaido denounced Maduro in January 2019, arguing that his reelection was a sham.
The United States immediately recognized Guaido as interim president. Since then, many of Venezuela’s neighbors and most Western countries have followed suit.
Most recently, Maduro held sham regional elections in an attempt to garner international legitimacy, but those fall far short off a legitimate democratic process.
With Venezuela in flames, China and Russia seek claims in the rubble. For years, China and Russia have sought more influence in the Western Hemisphere and are increasingly motivated to bolster their economic and security positions in South America, Central America, and the Caribbean.
China has pledged to invest $250 billion there and reach $500 billion in trade, while Russia has invested billions in loans in Venezuela.
About 100 Russian troops landed outside of Caracas, with unidentified equipment on March 16, 2019. Some U.S. officials fear they’ve come to help Maduro fend off a U.S.-led attempt to depose him.
The U.S. still recognizes Guaido, the leader of the country’s opposition-controlled legislative body, as Venezuela’s rightful president. Another part of the problem in Venezuela is the presence of 20,000 to 25,000 Cuban security officials.
Communist-run Cuba has been a key backer of the Venezuelan government since the revolution under Chavez in 1998. Right now, these Cuban thugs represent Maduro’s Praetorian Guards more so than his military, which he can’t entirely trust. In effect, he has become a total pawn of Cuba.
Most polls indicate that more than 80% of Venezuelans want Maduro gone. Some even encourage a civil uprising, but to have a war, both sides need to be armed. In the case of Venezuela, only one side—the government—has the guns. As in all communist takeovers, the first order of business is to take away the guns of the civilian population to be able to control them totally.
Maduro enjoys the full support of the armed Cuban thug forces, which have assisted the regime in fine-tuning its repression tactics and in setting up an intelligence apparatus to maintain a loyal military.
The regime has also set up urban paramilitary loyalist groups referred to as “colectivos,” responsible for much of the terrorizing and brutal repression of the population.
In previous unrest, almost all the fatalities have been civilians killed by the National Guard, the colectivos, or infilitrated Cuban thugs.
What is happening in Venezuela repeats that same old, tired story of a country’s history after the socialist locusts swoop in, promising to improve living conditions for the poor.
Wealth is transferred to a small group of communist leaders like Castro, Chavez, and Russian President Vladimir Putin. In Venezuela’s case, it is thought that large shipments of the country’s gold reserves have left the country and have been transferred to Switzerland for the account of Maduro and his small coterie that he has paid off.
Maduro also is trying to gain access to 31 tons of gold, valued at $1 billion, now being held by the Bank of England. He claims the money will be used to combat COVID-19, which is devastating Venezuela, but Guaido argues the money will be used to prop up Maduro’s crumbling and corrupt regime.
Communists essentially have fulfilled their promise to eliminate the wealth gap and income inequality by pushing everyone down to a uniform poverty level. Meanwhile, Maduro and others have become among the richest in the world. As always, with one-man rule, all the wealth of the country is transferred to that one man and his closest allies.
The sad thing is, it didn’t have to happen.
If our State Department had taken a more forceful role before Chavez’s election in 1998, Venezuela today could be a beacon for democracy in South America.
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