Venezuelas Lessons for American Socialists

(Bloomberg) ts hard to overstate how disastrous the reign of Hugo Chavez and his successor Nicolas Maduro has been for Venezuela. A recent series of Bloomberg articles vividly depicts the hellish never-ending struggle for survival in Caracas the countrys capital. Hungry children roam the streets people are fleeing the country health care is almost nonexistent violence is endemic even water is scarce. Chavezs so-called Bolivarian revolution took a peaceful middle-income country and transformed it into a nightmare that puts the ruinous Soviet Union of the 1980s to shame. Its important for other countries including wealthy ones like the U.S. not to ignore Venezuela but to use it as a cautionary tale. Politicians like Senator Bernie Sanders and Representative Alexandria Ocasio-Cortez have embraced socialism as have many young Americans. But what are the lessons of Venezuela? Why did the country become such a basket case? The Bolivarian revolutions defenders often make excuses for the Chavez-Maduro regime by claiming that the countrys penury is the result of outside forces. For example some argue that it was the fall in oil prices in late 2014 and 2015 that sunk the country. Venezuela is a petrostate petroleum products constituted about 95 percent of the countrys exports in 2014 so the price decline was naturally a blow. But although lower oil prices undoubtedly made things harder for Venezuela they cant be the primary culprit in the collapse. Venezuela stopped releasing many of its economic numbers in 2014. But other petrostates Saudi Arabia Russia Nigeria Angola and Kuwait saw their incomes stagnate or even fall after 2014 but they didnt experience anything remotely like the devastation that has hit Venezuela.