Venezuela at its Most Desperate Hour: Are the New Developments Strong Enough to Overcome the Dictatorship and Restore Democracy?

Flickr photo by Valentin Guerrero shared under a Creative Commons (BY-SA) license

A collapsed economy, a tyrannical dictatorship, and social tensions at its highest in Venezuela. The Maduro regime is in a turning point as Juan Guaidó, the president of the National Assembly, “constitutionally” rose to power. His position as the Interim President was immediately recognized by the United States and followed by more than 20 countries around the world. Nonetheless, as Guaidó continues to gain international support in his quest to restore democracy, Maduro continues to be protected by military leaders, and aided by the support of Russia and China. This crisis will be prolonged as long these conditions remain, opening a new front of confrontation between the US, Russia, and China. Furthermore, The agony of Chavismo, the political socialist ideology that reigned Venezuela in the last two decades, proposes the defeat of the most important left-wing ideology that influenced Latin America in the 2000s.

During the last two decades, Venezuela embarked on a political project called the “Bolivarian Revolution”. This ideology was centered around populist policies such as price controls, subsidies, and an aggressive nationalization process, creating significant distortions throughout the economy. The reforms generated an overwhelming state-led economy. Moreover, the Chavista regime claiming to recover the nation’s sovereignty from the elites dismantled the nation’s institutionality and silenced the opposition. In order to perpetuate its power and denied Human Rights violations, the government captured the judiciary branch at it service. Economically, the “ Revolution” was financed by the massive oil revenues the country received due to the 2000s commodity boom. Once oil prices plunged, the economy collapsed, proving these reforms to be unsustainable. By 2018, Venezuela continues to be inflicted by hyperinflation, generalized poverty, and food and services shortages, that have generated an exodus of more than 3 million people out of country.

The regime ensured its survival by gaining the support of the military, creating a corrupt system that economically benefits its leaders through the control of public institutions, oil production, and food distribution. As long as their loyalty remains with the regime, resources will continue to flow, guaranteeing the survival of the dictatorship. However, the same allegiance has not been constant throughout low and middle military ranks that have unsuccessfully led insurgencies against Maduro.

In order to gain international legitimacy, the regime launched two main political projects. The Bolivarian Alliance for the Peoples of Our America, or ALBA which was created to promote economic cooperation in left-wing governments in Latin America, and Petrocaribe a subsidized oil sales program. Both organizations served as a platform to advocate Chavismo as a viable project in the region. Furthermore, in South America, UNASUR, a regional organization initially sponsored by Venezuela and Brazil, lost its influence within the return and consolidation of right-wing governments in the most important democracies in the continent. The multilateral institution lost half of its members when it failed to denounce the generalized crisis in Venezuela. These developments have given the US, the opportunity to regain influence in Latin America as it leads the international efforts against the dictatorship and its sphere of influence in the region.

John Bolton, the Trump administration’s National Security Advisor has been an outspoken supporter of a stronger US intervention, as a response to China’s increasing presence in the region and Russia’s strong economic ties with Venezuela. Last November, announced that the government will have an active stance against what He called “Troika of Tyranny”, a group of countries integrated by Cuba, Venezuela, and Nicaragua. Trump’s actions toward Venezuela and more importantly whatever the results are, will mark a new chapter in the hemisphere and will outline US foreign policy in Latin America in a moment where China has gained influence during the last decade.

US recent economic sanctions against the state-own oil company PDVSA have blocked $7 billion in assets, restricted US purchases of Venezuela’s oil, causing an estimate of $11 billion losses in oil revenue for the Maduro regime. These measures are the most important economic actions against the dictatorship. Nonetheless, it is still unsure how Russia and China, that have heavenly invested in the country and have gained control of Venezuela’s oil and gold sector, are willing to go for maintaining the regime in power. Last United Nations Security Council, convened to discuss Venezuela, showed a profound division between the main powers, without achieving consensus on how to address the crisis.

The US has found close partners in Colombia and Brazil, two main bordering countries with Venezuela, raising concerns whether the US is ready, giving the circumstances, for military intervention as Maduro refuses to leave power. American officials have been cleared that all options are in the table and warned the regime, that any attack on Guaidó, the National Assembly or diplomatic personnel will be responded by the US. Although it is unsure of how this crisis will end, Venezuela’s has become the most important geopolitical battleground in Latin America, and whatever happens, its consequences will be felt throughout the region.




Economist writing about Latin America

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Alexander Roman

Alexander Roman

Economist writing about Latin America

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