Venezuela is socialist democracy, as there are democratic elections and multiple political parties. Policies of nationalisation under Chavez, though, probably did contribute to the current problems, as they caused a flight of capital.

http://www.reuters.com/article/2011/12/01/venezuela-national...

Way to over simplify things. Present-day Venezuela is very far from being communist even though the current government likes to market itself as such.

The reason Venezuela is like it is now is an incredibly complex subject spanning several decades of bad governments, corruption, oil money dependency, social inequality, etc ... accelerated by a particularly disastrous current government.