In a rather surprising development, the causes and ramifications of the ongoing crisis in Venezuela are now at the forefront of the American political discourse.
While the effects of the crisis — hyperinflation, breadlines, civil unrest — have only a limited effect on the U.S. economy, the question of what caused it has become a relevant issue in America.
President Donald Trump referred to it in his State of the Union message. “We are alarmed by the new calls to adopt socialism in our country. Tonight, we renew our resolve that America will never be a socialist country.”
Though he didn’t mention Venezuela by name, nor Bernie Sanders nor Alexandria Ocasio-Cortez, those were the reference points to his proclamation. People are asking if their proposals for universal medical care, a clean energy nation, and so on, could take the U.S. down the same road as Venezuela.
The evils of Hugo Chavez and his successor Nicolas Maduro have caused infinite pain to the citizenry of their country, but they provide a painless way out for advocates of socialism in America. They can blame the corruption, cronyism, brutality and sheer phenomenal stupidity of these “strongmen” for Venezuela’s crisis. Socialism works fine, they say, when not in the hands of malefactors like these.
They cite Bolivia and other countries in South America which have had socialist leaders in recent years and yet have prospered. They argue that it is not fair to hang this particular disaster around the necks of reasonable, humane, democratic socialists like the progressives in America, such as themselves.
Indeed, the case of Venezuela is complicated, and the element of socialism in the brew cannot easily be isolated as the cause of the disaster.
The Venezuelan economy depended on oil exports, and declining oil prices — nearly $120 a barrel in 2014 to around $25 a barrel in 2018 — has had a ruinous effect. As private companies left the country and growth spiraled downward, Maduro printed more and more money, which led to a nightmare inflation rate of around 14,000 percent this year. The state took on close to $100 billion in debt to Russia, China and other underwriters of brave socialist experiments, and cannot at this stage afford to import desperately needed food and medical supplies. (As Margaret Thatcher explained why socialism never works — because “eventually you run out of other people’s money.”)
And instead of allowing humanitarian aid from America to reach starving Venezuelans, Maduro closes the border on the grounds that it’s a pretext for a U.S. invasion to oust him. It isn’t, the troops aren’t mobilized for it; but Maduro’s willingness to let his people starve rather than give up power (to prove that socialism can work!) is as good a justification as any to get rid of him, by force if necessary.
But it is hard to maintain that socialism was merely one among many contributing causes. Socialism deserves more credit than that.
Chavez preached socialism, and he practiced what he preached. Socialism calls for massive government spending to help the poor; from 2000 to 2013, spending under Chavez rose to 40 percent of G.D.P., from 28 percent. Chavez sought to replace corporations with co-ops, and by 2006, there were an estimated 100,000 cooperatives in the country, employing more than 700,000 workers.” Utopia in bloom.
Raising the minimum wage, also a favorite of socialists, wasn’t overlooked; Nicolás Maduro raised it six times last year! (Not because it worked so well, but because it didn’t. Hyperinflation wiped out whatever wage gains workers enjoyed, prompting another wage hike, which was also wiped out, and so on.)
Furthermore, it is disingenuous to seek to disassociate socialism from its perpetrators in Venezuela. Chavez proudly called it “21st century socialism,” and none of his many leftist admirers around the globe recoiled from the appellation.
Britain’s Labour party leader Jeremy Corbyn eulogized Chavez as the one who “showed us there is a different and a better way of doing things. It’s called socialism, it’s called social justice, and it’s something that Venezuela has made a big step toward.”
When it seems to be going well, it’s socialism at work; when the bottom falls out, it’s not socialism’s fault, it’s something else. In that case, one can argue that the early success of Chavez wasn’t due to socialism either, but rather to the leftover affluence of a petro economy.
In the final analysis, the very socialist government that promised to help the poor eventually made life far more miserable for the poor than any prior capitalist government.
The dictatorial methods of Chavez and Maduro cannot alone be blamed for the calamity of Venezuela. They came to power with certain ideas, and put them into practice.
President Trump said that it won’t happen here. But Americans have been showing a significantly greater receptivity to the utopian promises of socialism, of government taking care of every social need. It was for the very reason that some think socialism could happen here that the president felt it necessary to say otherwise.
While the lessons of Venezuela should not be oversimplified, they should nevertheless make Americans extremely wary of politicians who proffer socialist solutions to problems.