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Initial Advice
The mind of the late commander Chávez was a melting pot of different political ideologies: populism, nationalism, agrarianism, indigenismo [1], Marxism, and Nasserism. However, one idea prevailed over the rest: the rejection of the classical liberal government and republic, central to Marxists. To demolish them was the goal he became obsessed with. He couldn’t accept the balance of power and independence of the public authorities, the existence of independent media, social organizations clearly opposed to the government and its excesses, and autonomous universities.
Among the available role models, the closest was Cuba, and its iconic leader, Fidel Castro. Cuba, the Caribbean island, is under a system organized by the ex-USSR and the Eastern Bloc. This system became the ideal type of totalitarian regimen led by a charismatic leader and supported by an unconditional subordinate group. Castro’s first suggestions to Chávez were along those lines: demolish liberal democracy and eradicate the institutions created and strengthened since January 23, 1958 (when the dictator Marcos Pérez Jiménez was ousted), the beginning of the long democratic cycle in Venezuela.
Hugo Chávez left this world without seeing the consolidation of his totalitarian project. The plan to re-found the republic and to destroy capitalism and representative democracy and replace them with socialism and direct democracy could not come to fruition. The strong resistance put up by the country kept him from fully reproducing the fidelista model, though he still managed to build an institutional order sporting most of the pieces designed by Castro.
Goal: Clinging to Power
Nicolás Maduro failed to learn the teachings — always chaotic and unclear — of his master, and lacks the charismatic power to rally chavistas around utopian ideals. The heir knows very well he will barely manage to survive amid the turmoil surrounding him. The dreams of 21st century socialism, communal government, and participatory democracy are but props for official inaugurations and to remember the late leader. Maduro has not been able to keep those dreams from losing all charm and rallying power.
Instead, Venezuela’s United Socialist Party (PSUV) is now mainly organized to win elections — to bribe and bully voters, not to build a new republic on the ruins of bourgeois democracy, as the late president used to dream. The only goal of the ruling elite is to remain in Miraflores (the country’s presidential seat of government) without their charismatic founding leader. Today, all we see is a chaotic and failed regime — with a mishmash of different ideologies rather than a defined doctrine — lacking effective answers for the dire situation facing the nation.
Economic Collapse
The government is at a loss about how to solve the serious economic issues. Finance Minister Nelson Merentes does, however, have a pragmatic vision. He recognizes the depth of the crisis and has accepted that the administration’s achievements have not been enough. Thus, he proposes an amendment to the Foreign Exchange Law to dull its more punitive aspects, to reopen the currency exchanges closed in 2010, and to increase the supply of foreign currency to close the gargantuan gap between the official dollar and its “parallel” counterpart.
The official exchange rate is at 6.30 Bsf. per US dollar, while the parallel exchange rate is over 40 Bsf. per US dollar — according to the Cato Institute’s Troubled Currencies Project [2]. US dollars need to flow, and the work of the Foreign Exchange Administration Commission (CADIVI) is not enough.
But the minister’s concerns are falling on deaf ears. Ricardo Sanguino, a PSUV representative in Congress, is keeping the National Assembly from debating the economic situation. According to his party, “there is no crisis.” Everything is a right-wing propaganda attempt to undermine the government, part of the “total collapse plan” denounced time after time by Nicolás Maduro in recent weeks.
Merentes’s weight within the Cabinet is not enough to put his proposals in motion. He fails to find supporters for his plans. It would seem Marxist orthodoxy, championed by his predecessor Jorge Giordani, continues to sway all economic decisions.
In the meantime, according to the country’s Central Bank, inflation since August, 2012, is at 45.4 percent; total inflation for 2013 will be close to 50 percent; the gap between official and parallel USD exchange rates is above 700 percent, the greatest in the country’s history; and foreign investment in Venezuela is the lowest in the region.
Advice for the New Context
Maduro and his fragile administration are being overrun by all kinds of trouble, and the country’s economic system is in tatters. The possibility of countering inflation via massive imports has been reduced, due to the decrease in oil production. Public services are also failing to meet constituent needs, and crime and insecurity have put the nation among the most dangerous places in the planet. Convicts run rampant through prisons, killing each other.
Facing this pandemonium, the only baffled response Maduro and his underlings manage to articulate is the one suggested by Cubans: more repression and harassment to the opposition, greater controls, and more hegemony in the media. That supposedly will keep the people from knowing the causes for and blunt the impacts of scarcity, inflation, insecurity, and the collapse of the electric power network.
Since December 10, 2012, when he took office, Maduro has “uncovered” 19 conspiracies designed to overthrow him. Cubans advised him to say that all the country’s terrible deficits stem from a sabotage organized by the opposition. Frequent blackouts are the result of the “electric coup”; scarcity and inflation are the consequence of “economic war”; the decay in public services comes from “fascist sabotage.”
It is a curious kind of country designed by fidelistas: After fifteen years of the partner chavistas ruling Venezuela, the main culprits of the crisis are the leaders of the opposition.
[1] A political ideology supporting social and political inclusion of indigenous minorities.
[2] Steve H. Hanke, The Troubled Currencies Project, Cato Institute – Johns Hopkins University. Retrieved on 9/25/2013 from http://www.cato.org/research/troubled-currencies-project.
