Challenges of the post-Chavez era| Venezuela in crisis?

Bulatlat perspective

Part 2 of 2

Part 1: The US trains its guns on Latin America once more| Venezuela in crisis?

The Western press has been full of stories regarding the “crisis” in Venezuela: about the shortages and inflation, corruption, the high crime rate, and the opposition-led demonstrations of students seeking to oust Venezuelan Pres. Nicolas Maduro. Well, as usual, Philippine media ignores what is happening in Venezuela, as it does with all other international issues not directly and visibly involving the Philippines or the US.

So what is really happening in Venezuela? What caused the seeming crisis? Are the problems externally-induced or more specifically, US-instigated?

While the US has been known to instigate economic and political crisis in countries that do not kowtow to its wishes and resists its intervention – mainly through economic embargos, military blockades, and financial pressures, and funding opposition groups, both armed and unarmed, and their protest actions – it could not create a crisis out of thin air. All the US could do is to exacerbate the internal problems prevailing in a country to subvert the government and facilitate “regime change.”

Venezuela is really facing shortages especially of basic commodities such as cooking oil, sugar, milk, corn flour, soap, detergent, and toilet paper. The Maduro government has been blaming big businessmen engaging in an “economic war” through hoarding thereby making goods scarce in the market to create panic and unrest. Big business, on the other hand, has been blaming the government’s mismanagement, specifically its price control policy, expropriations of land, foreign currency controls and low dollar reserves. Observers think that another factor is the Venezuelan government’s dependence on oil exports to finance its imports of basic goods.

Who is telling the truth?

Curiously, the only basic goods that are in short supply are those that are covered by the government’s price control policy.

This lends credence to the government’s assertion that big businesses and the country’s elite are hoarding these basic goods. If there was a general shortage of goods and commodities then the government could take the whole blame for it, but that is not the case. Venezuelans are not even going hungry.

According to an Al Jazeera report Is hoarding causing Venezuela food shortages? “The caloric intake of the average Venezuelan rose by 50 percent during the first 12 years of socialist governance, citing data from the National Nutrition Institute.”

Businesses tend to hoard to push prices up and to profit from a projected increase in prices.

The same thing happened in the Philippines during martial law. The late dictator Ferdinand Marcos, in reaction to the economic crisis and runaway inflation during the early 80s, imposed price controls on basic goods such as rice, milk, laundry detergent, among others. This resulted in the short supply of these goods such that retailers had to limit the quantity of these goods that any one customer could buy. Also look at how the rice cartel controlled the supply of rice during the Arroyo administration, which caused a surge in rice prices.

Worse, according to the same Al Jazeera feature article, government-subsidized food are being sold at higher prices to neighboring Colombia.

“One pack of Arena Pan [corn flour] is 6 bolivars in Venezuela. Once you have made the exchange [accounting for the 800 percent currency difference on the black market] it’s 200 bolivars in Colombia.”

Venezuela subsidises basic food products, making them cheap when they are available. State support for basic products, coupled with exchange-rate issues, entices black-marketers and hoarders to sell food outside the country.

The country’s elite could also create an artificial shortage for political reasons because they have the capital and control over the country’s supply of goods ad commodities.

However, the government’s policies also made the country vulnerable to profiteering. While it expropriated land for distribution to small farmers – which is of course, a good thing – apparently it has failed to make these productive enough to provide for the country’s needs. Domestic food production has fallen in recent years.

Some form of collective ownership of relatively productive, bigger tracts of land could have been instituted to replace the private, commercial operations of big landowners to ensure economies of scale.

Another factor could have been its dependence on oil exports to the detriment of a more balanced development of the economy across industries, sectors and regions. While oil is a high value commodity, dependence on imports makes the country vulnerable to supply and price manipulations. According to the same Al Jazeera report,

“Venezuela was, for example, a net rice exporter in 2006; by 2013 it imported more than 40 percent of its needs, according to the US Department of Agriculture.”

The government may have also fallen short in its campaign to eliminate corruption and bring down the country’s crime rate. Corruption is still a big problem. While the poverty rate has gone down, the crime rate is still very high.

“The private media [which is anti-Chavez] highlights crime to an enormous degree,” Greg Wilpert, author of Changing Venezuela by Taking Power: The History and Policies of the Chavez Presidency, told Al Jazeera. “It is an area the government has neglected” he said as it was “generally assumed that decreasing poverty would decrease crime”.

The government acknowledges that it has to do more to combat crime. Corruption, especially in the justice system, has been identified as a factor that is contributing to the high crime rate.

Are these problems serious enough to give rise to a political crisis? Are the student demonstrations a sign that the people are united in ousting President Maduro’s government?

For one, while there are shortages, there is no widespread hunger in Venezuela. In countries where there is abundance of food and other basic commodities, such as in the US, the incidence of hunger has been on the rise because an increasing number of people could hardly afford to buy food and other basic goods and services due to worsening joblessness. In 2012, 49.0 million Americans lived in food insecure households, 33.1 million adults and 15.9 million children.

In the Philippines where there are no food lines, hunger and poverty are likewise worsening despite the so-called robust economic growth.

The crime rate in Venezuela is high but poverty is no longer a big factor for its prevalence. Poverty in Venezuela has been reduced significantly and inequality has declined. The literacy rate in the Venezuela is even higher than the US where 32 million adults or 14 % of the population could not read and 21 percent of adults read below 5th grade level, and 19 percent of high school graduates can’t read.

While hunger, joblessness, and a spike in prices have brought about uprisings around the world, high crime rates never did result in an upsurge of protests against a government. Corruption has led to a surge in protests, such as in the Philippines, but only when it involved the highest officials of government, such as during the former Estrada administration. The same could not be said about the Maduro government.

Thus, in Venezuela, the movement to oust the Maduro government does not appear to have a strong base from among the masses. It is being led by the opposition and has its base from among students of private universities. One key figure in the opposition is Leopoldo Lopez, who comes from a wealthy family and was educated at Harvard and Kenyon College. He was the mayor of Chacao, the wealthiest district of Caracas, in 2000.

Another key figure in the opposition is Maria Corina Machado, a close ally of Pedro Carmona, a wealthy businessman who briefly took over the presidency after Hugo Chavez was ousted in a coup in April 2002. Machado was quoted in a news report calling for regime change. “A change of government as soon as possible: that is what we are proposing, very clearly.”

The opposition, specifically Machado’s NGO Sumate and Lopez’s political party Voluntad Popular, has reportedly received funding from the US National Endowment for Democracy (NED), which was later transformed into the International Republican Institute (IRI), and the National Democratic Institute (NDI). From 2000-2010, US agencies, including the US Agency for International Development (USAID) provided more than $100 million dollars to opposition groups in Venezuela.

Since 2007, nearly $15 million annually was provided to youth and student groups, including funding for training in the use of social networks to mobilize. Student leaders were sent to the US for workshops and conferences on Internet activism and media networking.

While Venezuela does have problems – shortages, corruption, and a high crime rate – it appears to be not enough to engender a political crisis manifesting in democratic mass demonstrations calling for the ouster of the Maduro government. Reports reveal that protest rallies are occurring in only 18 wealthy municipalities out of Venezuela’s total of 335. However, the western media is making it appear that Venezuela is in a worse situation than it really is and that the protest actions have the support of majority of the population. Quoting a Colombian commentator, Roger Harris in his article A Manufactured Crisis|Venezuela is Not Occupy wrote “Venezuela is an odd country, the only place where the rich protest and the poor celebrate.”

For the US, the death of Chavez and the problems confronting the Maduro government present opportunities for regime change and the installation of a more “friendly government” in Venezuela. In the meantime, Republican Ileana Ros-Lehtinen of Florida introduced Resolution 488, which was eventually passed by the US House of Representatives by a 393 to 1 vote on March 4. “The resolution urges the U.S. State Department to work with other countries and the Organization of American States (OAS) to intervene in the international affairs of Venezuela.”

For the time being, what is stopping the US from intervening more aggressively and militarily in Venezuela is that it is in a quagmire because of the resistance of the people in Iraq and Afghanistan to its occupation. However, we could also do our share by informing others about the victories and struggles of the Venezuelan people and by expressing solidarity with them against US intervention in their internal affairs. (

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