Venezuela Is Collapsing. Could a civil war be next? | Hacker News Reader

Venezuela Is Collapsing. Could a civil war be next?

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49 pointssmacktoward33 comments

>For Venezuelans who remember ’89, the party system was the enemy, and Chávez was the hero, because things got better under him first of all. The price of oil went up. He started opening free clinics, and primary education, and universal health care, and subsidized food, et cetera, et cetera, et cetera, but he acted as if there was enough money to sustain all this.

In fairness, he acted as if Venezuela wasn't going to become the bystander in a proxy fight between Saudi Arabia and US shale oil & renewable energy.

Venezuelan exports have always been largely oil based so whomever was in power, the plunge in oil price was going to cause disaster and a crisis of legitimacy.

I'd say that Chavez and his family doing more to enrich themselves than plan for the country's future when oil prices inevitably dropped played a large part.

You can say what you want. Doesn't change the fact that Chavez helped bring many of Venezuela's poor towards something approaching a dignified standard of living.

Sure, by stealing money from the people who have it and giving it to poor people, for a short time you make the lot of the poor better.

Now where there were few jobs there are none, and crime has gone from a big problem to a terrible problem. Soon there will be war.

These are not policies that benefit the poor.

>Sure, by stealing money from the people who have it and giving it to poor people

Largely by redirecting money from oil exports to anti-poverty programs.

Before he took power that money was mostly siphoned off abroad and by the upper classes.

Do you really think the country would have fared much better if this practice continued?

The economy was growing under Chavez's predecessors. Yes, it would have fared much, much better. What he did with oil is less important than what he did to the rest of the economy. Chavez was lucky, in a way, because he died right about the time math caught up with his economic policies.

Actually the economy suffered a massive contraction in the 80s when - surprise! - oil prices plunged. This is partly what led Chavez into power - mostly because while the country technically returned to growth - wages did not go up and unemployment did not go down.

Same cause last time as this time but last time was "all the fault of capitalism" and this one was "all the fault of socialism".

Capitalism is theft. It's mathematically impossible for the holder of capital to generate profit if he pays workers wages equal to the value their labor produces. Somebody has to be shortchanged somewhere along the line. The rich in Venezuela should be thankful they only have to deal with mild social democratic wealth redistribution policies.

Everything except capitalism is theft. In a free market every good exchange is voluntary - made because both parties have decided they're slightly better off with it (else, they wouldn't participate). Therefore, everything but a free market implies deals that are non-voluntary for at least one of the parties.

Voluntary economic associations are not theft. To say that capitalism is theft is to engage in sophistry. It's only theft if the workers are actually slaves.

And brought all of Venezuela toward the eventual disaster under Maduro that was the necessary result of his policies.

But before Chavez the economy was considerably more diverse. His policies turned a vulnerability into a ticking time bomb.

It really wasn't. It moved from maybe 80% to 90% of exports. They were already in the full throes of Dutch disease when Chavez took power.

Saudi Arabia has failed just as badly at diversifying their economy for pretty much the exact same reason.

Exports only tell part of the story. Much of what a country consumes is produced locally, so just looking at exports ignores the collapse of industries like construction and agriculture.

Everybody loves a big spender. Spending like there is no tomorrow is how you appease children--not how you should run a household, let alone a business or country.

> The myth in Venezuela is that there’s enough oil revenues there to support whatever government is in power and whatever that government wants to do.

This is the myth of Socialism: that there is enough money to support whatever the people require to permit the government to do whatever it wants to do.

What are you talking about? What myth? There is no myth whatsoever. As the previous comment noted, the plunge in oil price was going to cause disaster and a crisis of legitimacy, regardless of who was in power. Please stop making such senseless, irresponsible, and even downright dangerous connections.

An entire article that sidesteps the fact that yet another socialist country has failed.

"We will end poverty as we know it"

Nope, sorry....... try again.

In all fairness, the corrupting influence of big money interests from federalist countries does not help here. One can hardly argue that socialist reformers in Central America were the reason those governments failed. Political assassinations driven by the policies of capitalist nations caused those instabilities.

Not trying to argue that Chavez and now Maduro are not demagogues, but let's not throw the baby out with the bath water here. No one ever said pure socialism worked, just like pure capitalism is a pipe dream. The world catches it's breath when moderates of both sides of the spectrum are in power.

Yet another but it wasn't socialism episode. Nationalization of strategic sectors and currency manipulation had nothing to do I guess.

No, it's not that simple. Scandinavia has had a pretty good run with socialism. But Norway does the old college-educated trick of investing 10% of it's oil income. And Sweden has a much more diversified economy. In South and Central America, what we have are dirt poor countries with enormous export income. For sixty years the wealthy of these countries have been siphoning off the export income to make themselves rich at the expense of everyone else. When a charismatic demagogue steps up and offers to make you feel as rich as the countries export bank account suggests you should be, what are you supposed to do? Politely decline and tell them to invest in infrastructure and a rainy day fund?

Socialism in the extreme is a hazard to stable government. But so is capitalism, federalism, militarism, and any other -ism.

Brazil has a wealth of resources --unbelievable, more than Mexico perh but yet they continue to do worse than middling -socialists didn't improve Brazil one bit despite being in power over two decades.

They should look to Chile. A can do country. One which almost went socialist but avoided it and came out doing pretty well for itself.

The problem with those counties is that the whether they go communist or socialist or any dictatorship is that the caudilo mentality permeates everything. Same behavior in the Caucasus region. Mexico has been ravaged by this mentality --their economy was pretty much on par with European countries outside the big five in the early 1900s --but caudiloes happened.

Chile is ruled by their socialist party at the moment. The originator of the modern Chilean Socialist Party, Lagos, actually took the traditional Marxist socialist platform and moderated it to much success. Turns out moderation and not a black and white this OR that platform is more resilient. Who knew?

I think it's helped they are all pretty much centrists who favor free enterprise and don't go about nationalizing domestic or foreign companies --and don't engage in typical caudilo practices much of the southern cone suffers from. Bachelet resisted calls from her coalition to "redistribute" moneys from their copper mining ops to close income differences --something a certain bolivian would do no question for a little income "high" today.

Social welfare is not socialism.

It’s not?

I find it strange how people view socialism in black and white, but not capitalism.

I find it strange how countries with working social policies are real socialism and countries that collapse are not real socialism, despite how socialist or capitalist those working countries are. It makes no sense at all that Venezuela or the USSR is not real socialism but Scandinavian countries with private ownership of the means of production but a big enough tax budget to implement stable welfare are real socialism.

You missed the point

Give me an example of “real” capitalism.

I’d say the Scandinavian model is a pretty happy middle ground.

capitalism is a mode of economy. Any country that employs private ownership of the means of production coupled with market-driven trade of goods and services is capitalist. There is no purity spiral of capitalism unless you want to argue the libertarian angle but then you need to accept the belief that tax is illegitimate, which is not inherent to capitalism.

I can not think of a country that does not have a mix of private and public ownership of production/distribution. What should we refer to those countries as?

government does not equal socialism. Socialism is against private ownership of the means of production - an economy that permits private ownership of the means of production is capitalist. The few industries that are nationalised are not held in common by the people and managed democratically - they're owned by the government who try to manage it the way they think the people would want it. That's what's commonly referred to as state capitalism.

And capitalism is against public ownership of the means of production. Any country that does both, has an economy that is neither purely socialist nor capitalist. I personally would not want to live in a purely capitalist, nor a purely socialist state.

(Sidenote: State capitalism and market socialism are essentially the same thing)

I hate this line of reasoning, because it almost always end up asserting why America should not adopt socialist policy X, because socialist countries fail.

When it is pointed out that policy X is currently active in Sweden, France, or Japan, it is handwaved away by saying how these countries are too small/too big/too sparsely populated/too densely populated/culturally homogeneous/just plain culturally different.

Apparently Venezuela and Cuba have so much in common with the USA, unlike those exotic places like Canada or Sweden, whose culture we barely understand.

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