Falling oil prices worldwide and failing socialist policies at home have pushed Venezuela’s economy into recession. But rather than recognizing the errors of his predecessor and mentor, Hugo Chávez, President Nicolás Maduro is resorting to increasingly totalitarian measures to stay in power.
Maduro narrowly won a presidential election in 2013, a month after Chávez, who had been in power since 1999, died of cancer.
Since Maduro took office, Venezuela’s economic prospects have deteriorated more rapidly. The economy contracted 4 percent last year and is expected to shrink further. The government’s fiscal deficit is heading for 20 percent.
Maduro blames the crisis on right-wing “extremists” who are supposedly plotting with Chávez’ nemesis, the United States, to undermine the Latin American country’s permanent revolution.
Recently, he saw that the bosses of a large Venezuelan pharmacy chain and a supermarket company were arrested — the sort of bourgeois reactionaries Maduro says are responsible for rampant shortages of basic goods, including flour, milk and shampoo.
Last month, the defense minister defied the Constitution to decree that troops could turn their guns on protesters if they turned violent. Demonstrations continue even as thousands have been interned.
Although the courts are unwilling to challenge the government and few independent media outlets remain in business, opposition parties say it is becoming clearer to ordinary voters that their plight is the government’s making.
The global drop in oil prices has exacerbated the shortcomings of Venezuela’s nationalized petroleum industry. Instead of saving when prices were high, the government and state oil company issued more debt between them than any emerging economy from 2007 to 2011 to finance lavish spending on education, food and social housing as well as an expansion of the public sector workforce. The number of Venezuelans in the government’s employ has doubled since Chávez first assumed power.
The socialist government nationalized hundreds of companies, most of which are now losing money and require subsidies to stay afloat. Remaining private companies have been subjugated to price controls, discouraging investment.
Inflation soared to 64 percent in November as the government prints money to continue to pay for an expansive welfare state. Maduro blames “capitalist parasites” for the subsequent price increases.