A turnaround in Venezuela?

Juan Guaidó at the State of the Union

Even as Juan Guaidó – recognized by the US and scores of other countries as the legitimate president of Venezuela since shortly after his swearing-in in January of last year – was accepting bipartisan applause during the State of the Union address in early February, back in his homeland dictator Nicolas Maduro was, according to various reports, more secure in his power than he was a year ago.

As Bloomberg News’s Patricia Laya and Alex Vasquez wrote recently, the Venezuelan economy, which for years has been going from bad to worse thanks to Maduro’s “corruption and colossal mismanagement,” has achieved “a certain measure of stability.” Fewer Venezuelans are escaping to Colombia or Argentina or the US, and some are even moving back. How did this happen? In the last few months, Maduro has lifted price controls and has been “allowing dollars to flow freely and private enterprise to flourish.” Yes, dollars:

Nicolas Maduro

Over the past year, the U.S. dollar has become Venezuela’s unofficial currency, appearing in cafeteria menus and mom-and-pop shop windows blocks from the presidential palace. Across the capital, bodegas filled with French Champagne, vacuum-sealed salmon and Grana Padano Italian cheese appeared where bankrupt shops had once been. The bolivar, the official currency, has become worthless through years of hyperinflation.

A Reuters dispatch even described Maduro has having initiated “a broad liberalization” of his country’s economy. The Economist wrote that Maduro had “become a capitalist, sort of.”

One factory owner told the Wall Street Journal, which ran a long article on these developments, that he felt encouraged: “Things were paralyzed. Now there’s cash flow. There’s a possibility to buy material. And that’s positive. We can offer work.” In Caracas, at least, “everything from imported medicines to Iberian hams to auto parts—all once hard to find—now overflows store shelves. And companies large and small, from Venezuela’s biggest private company, food producer Polar, to makers of glue and shoes, have begun to crank up production.”

Hugo Chávez

Still the Journal underscored that Venezuela is hardly out of the woods. Far from it. It’s still “an economic basket case” whose economy has shrunk by 60% since Maduro inherited power upon the death of his mentor, Hugo Chávez, in 2013, and expected to contract a further 10% in 2020. And Venezuela continues to have the world’s highest inflation rate. “Some economists,” moreover, “say the economy’s recovery may be fleeting, since so much of it is import-driven. They note that the government has no macroeconomic stability plan, and none of its changes is codified in law, meaning the government could quickly return to the days of jailing shop owners accused of price gouging.”

In any event, this economic “liberalization” isn’t accompanied by anything resembling a boost in individual liberty and human rights. Free markets? Yes – to an extent, anyway. Freedom of speech, freedom of assembly, and the like? No. As Laya and Vasquez put it, Venezuela seems to be headed toward “a version of Chinese-style state capitalism.” Similarly, the Journal reported that “factory operators, importers and store owners” in the Bolivarian Republic are “anxiously wondering whether Venezuela is moving, ever so slowly, toward a Chinese-like model of authoritarian capitalism—or whether Mr. Maduro is just temporarily giving the market a little freedom while the economy is under severe pressure from U.S. sanctions.”

Miraflores Palace

If Maduro’s Venezuela is really following the Chinese model now, its starving slaves may one day be relatively well-fed slaves. If Maduro is just temporarily opening things up in a cynical attempt to cool things off, he may well clamp down again as soon as he feels he can get away with it. In either case, Venezuela is certainly not on its way to becoming a genuinely free nation. On the contrary, his superficial and perhaps impermanent “reforms” may, as the Journal noted, “reduce dissent” – and lessen the chances that Guaidó will ever be able to move into the Miraflores Palace.

Meet Venezuela’s Paris Hilton

María Gabriela Chávez and Nicolás Maduro

We’ve spent this week pondering the possible repercussions of the December 6 parliamentary elections in Venezuela, in which pro-freedom candidates triumphed over the corrupt chavista hacks who’ve spent the last sixteen years picking the people’s pockets, destroying their economy, and maiming their liberties. We’ve also been discussing the reasons why sensible Venezuelans voted down chavismo, after all these years of wall-to-wall socialist propaganda. Those reasons, perhaps, were best summed up best in an August news article in Diario Las Américas, which is published in Miami. Under the headline “María Gabriela Chávez may be the richest woman in Venezuela,” the newspaper reported that Ms. Chávez – the daughter of the country’s late President Hugo Chávez, founder and household god of chavismo, who famously preached to his subjects that “being rich is bad” – has a fortune that amounts to something upwards of four billion dollars and that is held in banks in the U.S. and Andorra.

Lorenzo Mendoza

This makes her even richer than Gustavo Cisneros, who is worth 3.6 billion dollars and whom Forbes counts as the richest person in Venezuela. And it makes her lots, lots richer than Lorenzo Mendoza, CEO of Venezuela’s largest privately owned company, Empresas Polar, whom chavistas were taught to demonize as “the great oligarch.”

Is it necessary to underscore that María Gabriela, unlike Mendoza, hasn’t done anything to earn that kind of money? The Atlantic has described her as a “socialist socialite, bon vivant, Pomeranian enthusiast, and occasional Instagram troll,” none of which occupations are known to pay particularly well. The Venezuelan media have frequently compared her to Paris Hilton. At times during her father’s tenure, he said things that made it seem she might end up being his chosen successor. Perhaps his death – in early 2013 – came too quickly for him to make the necessary arrangements. In any event, after he died, she continued to live in the presidential palace, paying occasional visits to the likes of Fidel Castro and Cristina Kirchner. In 2014, an opposition congressman complained that she, along with the other daughters of Chávez’s and of his successor, Nicolás Maduro, were costing taxpayers $3.6 million a day. Then, in August 2014, Maduro named her alternate ambassador to the United Nations.

Hugo Chávez

The UN appointment, noted The Atlantic, was “roundly condemned by the national opposition—and even some Chavistas—as ludicrous and gallingly nepotistic,” given that María Gabriela had flunked or quit the international-affairs program at Venezuela’s Central University, and, despite later receiving a journalism degree, has never practiced that profession or, apparently, any other. Noting that María Gabriela has been accused of making illegal profits off of overpriced food imports, among other things, the Atlantic suggested that her UN job might be “a way of getting her out of the public eye, while simultaneously justifying state expenditures for her upkeep and possibly granting her either diplomatic or parliamentary immunity should it ever be required.” It might even be a first step toward the presidency.

A selfie shared by María Gabriela Chávez on social media

Whatever. The important fact here is that María Gabriela – daughter of an international hero of socialism who impoverished his people while vilifying men and women who got rich (and created wealth) through honest hard work – is herself a multibillionaire, thanks obviously to massive plundering of her nation’s treasury. Is there any hope that this revelation will temper the enthusiasm of countless stooges around the world for the so-called accomplishments of Hugo Chávez? Almost surely not. Such fandom, alas, has nothing whatsoever to do with reality and everything to do with utopian ideology and the empty slogans that go with it.