The Socialist Utopian Paradise Of Venezuela: An Economic Stewardship Perspective

It appears that in the light of day, South America’s version of Wreck-It Ralph and Sean Penn soul-mate, Hugo “Sulphur” Chavez, was no different than most socialist turants, an economic illiterate. From my alma mater, the Institute for Management Development in Switzerland:

Some would argue that it is too early to evaluate his lasting impact on Venezuela and in promoting regional integration in Latin America. With respect to regional integration many of the institutional innovations that he championed are still embryonic (e.g., the bank of the South and the Community of Latin American and Caribbean States), even though his most ardent supporters believe that it is just a question of time for them to have substantive impact.Time will tell, although I would not expect any of these innovations to make much of a difference in economic terms.

Chávez’s track record in terms of Venezuela’s economic performance since 1999, however, provides an easier point of reference to evaluate the impact of his policies.Venezuela experienced positive growth during the Chávez era, despite two deep recessions (one associated with an oil strike and political uncertainty in 2002-03 and another in 2009-10 reflecting the impact of the global recession on oil prices and a pro-cyclical fiscal policy).Average annual growth jumped from 1.6% in the 1990s to roughly 4.5% in the 2000-12 period, unemployment declined from 14.5% (1999) to 8% by 2012, and the proportion of the population living below the national poverty line fell from 50.4% (1998) to 31.9% (2011).These numbers seem impressive at first sight, but if one takes into account the positive impact of soaring oil prices on the Venezuelan economy over the period in question, then the results are less compelling.

So how about that successful socialism, huh? Karl will be along any minute to tell us that Venezuela wasn’t really a true socialist state and Chavez wasn’t really a communist.

As I have pointed out before – where do you suppose every “socialist” economy gets its mojo?

The Chávez administration was characterized by inward-looking policies coupled with state interventionism and growing reliance on the rents associated with the oil windfall (fuels and mining products currently account for 91% of Venezuela’s exports). As a consequence, Venezuela is now at the very bottom of the rankings of world competitiveness as calculated by IMD and is the worst performer among middle-income countries in terms of ease of doing business (ranking 180th among the 185 economies surveyed).[1] Ironically, oil production has declined almost 20% over the Chávez years owing to ageing fields, low levels of investment, and the mismanagement of PDVSA (the state-owned oil company) which has become an all-purpose cash-cow to finance the “Bolivarian Revolution.”

Why, it has to be a remora like parasite on the back of capitalism. That’s why I’ve always said that the so called “progressives” want just enough of our capitalism to pay for their socialism.

Wassup with that, Komrade Karl?

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One thought on “The Socialist Utopian Paradise Of Venezuela: An Economic Stewardship Perspective

  1. There have been some positive attempts at socialism, but so far, most of them have had a very bumpy road. Castro started out cleaning up the corrupt mess from the US’s dysfunctional foreign policy mixed with rampant crime. Some things he worked out, some he didn’t, but look where we are; two steps short of a police state, so who are we to cast stones?

    I’m not saying that socialism is the answer. The media is current feeding the globalist pablum to the masses that the problem is with “capitalism”. NOTHING could be further from the truth. The problem is corruption, and that will plague any form of government, whether it’s a monarchy, a democratic republic, a dictatorship, or a communistic or socialistic state. On the flip side, I would argue that ANY ONE of those forms of government could work quite well if the motivations of the leaders were able to escape greed and corruption. I think we have seen parts of that happen in many of these different forms of government, but as happened with Iran in 1953 with the US’s meddling with Mossadegh’s election under Operation Ajax, we booted out their democratically elected choice and put in yet another puppet (the Shah) willing to support our foreign policy.

    I had followed Chavez for a while and remembered his kidnapping by the elite landowners years ago. The people went into an uproar and the majority of the military supported his release. Those elites, …. they are the problem, because most of them haven’t done squat to earn where they are. Same thing with this country, Europe, and the Rothschilds and Rockefellers; they either inherit it or steal it, and anyone who points it out winds up in a small plane crash or has a two bullet to the back of the head suicide.

    Dr. Paul Craig Roberts was Reagan’s former Asst Sec of the Treasury. He has lambasted every presidency since Reagan for taking us down the globalist road to ruin, so one can’t accuse him of partisan politics. Here is his latest take on Chavez:

    http://www.paulcraigroberts.org/2013/03/12/hugo-chavez-paul-craig-roberts-4/

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