Zelda 25th Anniversary by Ag+

It is said that the brightest stars burn the fastest. And Venezuela was nothing short of the brightest star in South America. The prosperity that we enjoyed during the 1950s through 1970s was a clear contrast to our neighboring countries and their instability. Venezuela was once the land European and Latin American immigrants would travel to seek refuge from oppressive regimes. This was more poignant right after World War II. Therefore it is depressing to see such promise be mired in the failed policies of foolish men. Venezuela’s disastrous turn should be a cautionary tale for any country in the world. The tragic tale of a prosperous populace too complacent in their own success to prevent their leaders from tearing the country apart. There are many lessons to be drawn from Venezuela’s economic and political history.

First, The growth of “21st Century” Socialism did not start in the 21st century. The roots for the current situation in Venezuela today were laid out, I believe, in 1948. Socialism has fully penetrated Venezuelan civil society, only after laying out its ruinous foundations throughout the 63 years of historical events. The problem with these circumstances is that the slow take over of civil life -to which I refer, political and economic freedom- has kept people unaware of the consequences until it was too late. Another factor for the complacency found within Venezuelans until the late 1980s was due to the boom in oil prices. The nationalization of the leading industries in Venezuela and subsidized prices is what kept the people anesthetized from the political and economic upheaval, like a blood-gorged mosquito whose bite is not felt until he withdraws; the government devalued the currency and created inflation, then decided to remove price controls (at the wrong time). The slow take over allowed for demagogues to incite hate against capitalists, bourgeoisie, and class distinctions. Ultimately, the economic crisis that came about from these policies are what allowed Hugo Chavez, in an example of cosmic alignment, to become the ruling leader of Venezuela.

Second, the rise of Venezuela’s economy is easy to understand, but the fall of Venezuela seemed a lot more confusing. How could such a rich vibrant nation fall into such destitution? It turns out that every Venezuelan leaders had taken it upon themselves to plan the economy of Venezuela. While also enacting paternalistic legislation, an example is the Perez’s interview with Hugo J. Faira; “I asked for his opinion about a possible privatization of PDVSA, the state owned oil company. He answered that such a privatization would be equivalent to selling his own home”(Faria, Hugo J., pg525). Venezuela’s leaders valued order and control over the freedom of individuals. The only advantage that the government had was the distortion of economic reality by high oil prices, although that wouldn’t last for long. Once reality crashed down on the Venezuelan Government’s head, the severe situation which they found themselves in was ultimately too difficult for these men to admit. The total failure of the two major parties in Venezuela left them wide open for justly earned antagonism that led to riots in 1989. The folly of the Venezuelan government was to ignore economics. F.A Hayek wrote in the Fatal Conceit “The curious task of economics is to demonstrate to men how little they really know about what they imagine they can design”. The Caracazo was the result  of ignoring economics at the expense of the Venezuelan people. Chavez built his candidacy, not on a call for socialism, but on the idea of free enterprise, self-determination, and democratic rule. When accused of communist sympathies, in a 1998 interview with Jose Ramoz from Univision, Chavez states “If for example, after two years I end up being a fiasco, a failure, or a criminal,  or corrupted or I do something that justifies my exit from power before 5 years, I would be willing to leave office”. On matters of nationalization and economic principles he says “I have the best relations with the rest of the stations, they must remain private…we are willing to assist international private capital even more so they can come here and invest in the most diverse areas: agriculture, agro-industry, petrochemical, gas industry, everything regarding the development of our country”. If I did not know any better and I was watching that in the year 1998 I would have voted for him. Nine years later we are instead left disappointed by speeches like the one he gave on the first day of classes:

“Society cannot allow the private sector to do whatever it wants… All schools will be bound to “subordinate themselves to the constitution” and comply with the “new Bolivarian educational system… They taught us to admire Christopher Columbus and Superman… education based on capitalist ideology had destroyed “the values of children.””

The profound change in ideology started the moment he took office, which leads any observer to think that he based his candidacy on lies, rather than having a sudden change of heart.  The ultimate failure of his socialist policies are clear and evident to any observer, but one can take little pleasure from such failures, because they cost the lives of innocent people.  The quote also shows the fallacy of Chavez’s thinking. He fails to understand that private individuals come before society. It is the individual that dictates collective action, without his voluntary collaboration, the society collapses. This is seen by the discontent from teachers, parents and even kids, who are forced, at Chavez’s orders, to be reeducated or prohibited from choosing what to learn in school.

The shortcoming of all central planners is their inability to control every thought, action, and decision of an individual living within their country. Ignoring this principle is the equivalent of jumping off a roof thinking you are immune to gravity; the situation in Venezuela is the collection of multiple failed policies and the obsession of Venezuelan leaders to obtain ever more power over the economy. The destruction of the currency to offset government debt has brought about misery and destroyed any desire to save money by the Venezuelan people. All money earned has to be spent or accept the loss of its value. Chavez rails against the “irrational” consumerist behavior of the typical Venezuelan, when in fact, the only rational option for a Venezuelan worker is to exchange the depreciating Bolivar for stuff: food, Gucci purses, LCD TVs, Nike shoes, etc are the only way to stop the inflation from burning a hole in their pocket. The shame of central planners is that they will never take blame for the repercussion of their actions. The authors of The Perfect Guide for the Latin American Idiot have a detailed chronicle about the fallacious arguments they unabashedly preach from the political pulpit. The idiot’s ignorance, were it not so dangerous, borders on the caricature; their rage against high prices, scarcity, and revolt is unjustly misplaced on the Venezuelan entrepreneur, the Gringos and the bourgeoisie. Chavez fails to acknowledge that  prices have been fixed, farms have been seized by the government, tariffs on imports have been enacted, and many corporations have been nationalized; yet, somehow, the blame belongs to the businessman; who has stopped producing at low prices, or has yet to yield to the State’s boot. The ultimate cost to Venezuela’s social and economic life is unfortunately unknown. The brain drain of the professional class will set back the country for decades, while the attempt to devalue money will have the rest of Venezuelans worse off than monkeys. Chavez has even lost the support of “true” socialists- an occurrence well-documented by Hayek’s Road to Serfdom- the left-leaning intelligentsia will preach for egalitarianism, equality, and freedom from want. But they will balk at the amount of force required to enact compliance, the lack of economic freedom will bother them very little, but as the Government violates their privacy (to ensure they are following the law), censors the press, enacts ideological indoctrination upon College Professors (often times, the main proponents of socialism), forces schools to follow guidelines created by government bureaucrats, uses the police to raid the houses of opposition members, uses violence to put down any peaceful protests by the people, and ignores worker’s unions, they will claim the government is not a true socialist government; but by that point it will be too late. The harm is already done and any symbolic abandonment of their leader will be useless; their leader will have already allied himself with the old guard of politicians that existed before socialism was imposed, the sycophants, sociopaths, and psychopaths will have moved up the ranks left open by the symbolic resignations. The result of all this central planning is imposed inefficiency on the markets; the destruction of all wealth; and the violation of freedom, particularly, freedom of choice.

Every year that Chavez has remained in power, he has increased his belligerency, violent speeches, accusations, and disregard towards the opposition. The slogan often shouted in his public events is “socialismo, patria, o muerte” (socialism, homeland, or death). This exemplifies his positions in all aspects of governing. Socialism as the ruling ideology; Loyalty to the Country regardless of its state; and ultimately, he requires any follower to die for the communist cause, while calling for the death of traitors that might dare criticize his plans. This mantra does not allow for an individual’s pursuit of happiness; it does not allow for both economic and political freedoms; the Venezuelan government is considered more important than its citizens, disregarding any calls of illegitimacy of Chavez’s government. Because the government has taken over the means of productions in the majority of businesses and enacted price controls, citizens are left hungry and destitute. Their power as a consumer is worthless within the “authorized” market; their Bolivar is worthless and producers have stopped supplying products at below marginal cost. In addition, a person who could previously afford a week’s worth of groceries and rely on a bit of charity from kind-hearted Venezuelans, now finds himself in a much tougher situation; he struggles to afford the week’s worth of food, but  now has to wait in line for hours to obtain said food; And the voluntary charity from fellow citizens? Gone, now everyone is as miserable and poor while waiting on the same line. The desire by the poor to have equality and justice is understandable and a desire-able goal. But it must be achieved by improving efficiency, increasing production, raising capital, encouraging success; Instead, they have succeeded in forcing everyone to be as miserable as the poor and destitute themselves. The supply of goods has decreased, the cost of living has increased. And the result is increased civil discord and crime.  The question still remains, what can be done by the Venezuelan people?

The Venezuelan people have the responsibility to educate themselves and others about the failures of the government regime. They ought to challenge the Socialists both intellectually and politically. The people need to embrace the idea of individual freedom as the beneficiary of the country as a whole, and be educated enough to avoid falling in the traps that government and interventionist alike promote. If Venezuelans were taught to think in terms of economics and saw themselves as consumers (not as different classes), the whole debate would shift to different discussions. The key objective in the years ahead will be to campaign within the local and state level, influence must be built from the ground up, a true democratic campaign should come from the desire of the Venezuelan people. To the contrary of popular belief in countries outside of Venezuela. The opposition to Chavez is not actually pro-capitalism. In fact, they advocate some of the same policies. The problem with those candidates is that they are a) less charismatic than Hugo Chavez, and b) the Venezuelan people would rather vote for the Devil They Know. We need actual contrast between the two candidates. Show the difference in thinking, and campaign not just on the idea of free market and business, but putting an end to the corrupt oligarch policies currently being enforced. It will be critical to explain to the people that you can be pro-capitalism without being pro-big business. Once Chavez and his party is voted (or forced) out of the government, the greatest challenge will be to realign the country with a Capitalist policy.

The only way for Venezuela to turn around is to dethrone Hugo Chavez Frias and avoid electing another socialist into office. This is easier said than done, it will require revolutionary thinking. An admiration for individualism and success, rather than striving for a collectivist utopia. That’s something the Venezuelan people have failed to understand; their constant partisanship and ever changing alliance for politicians that will enact more welfare is the result of a system rotten to the core. Venezuela’s communist regime will not change until enough people are fed up with the system. It also won’t change as long as the economy totters on the brink of collapse. I do believe that as hyperinflation sets in, the producers stop all the manufacturing, the milk, the eggs, the rice, the meat, and everything of value disappears, then Venezuelans might be pushed to further action, particularly, the Army. Centrally planned economies do not work; the end result is violence, starvation, crime, and a crumbling infrastructure. The belief by socialists all over the world that “this is not true socialism”, causes them to ignore every failure of socialism until their own country is in ruins.