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Venezuela shows socialism cannot work

By BOB MARTIN

Contributing columnist

Lots of news about fake news recently. My candidate for underreported real news is the disaster unfolding in Venezuela.

In the early 1990s, Hugo Chavez was one more revolutionary Marxist colonel in a South American army who wanted to be president.  However, socialism’s baggage from the 20th century (all that nasty news about the death camps and the “killing fields”) made it hard to rally people behind a populist uprising.

German National Socialism and communist Russia, China, Cuba, North Korea, Cambodia and assorted countries in Africa and South America were difficult to explain. In short, Hugo had to re-brand himself if he wanted to be elected president.     

Chavez’s re-branding became Bolivarian “socialism for the 21st century.”  Apparently, it was not socialism of the 20th century by Chavez’s declaration, although the policies included income redistribution, land reform and nationalization of property. Apparently, a rose by any other name is not a rose.     

He came to power in the mid-90s. In a steady stream of elections and referendums, voter turnout was usually around 80 percent and Chavez had a significant plurality in each case. The turnouts and the results are at least suspicious.    

Following his election, he became the darling of liberal celebrities, such as Sean Penn, Danny Glover, Oliver Stone, Michael Moore and Noam Chomsky. Stone made a documentary about his “pal” Hugo and Chomsky praised his ability to lower poverty by 33 percent in early 2000 (notably when oil prices were very high).   

High oil prices financed Chavez’s lavish welfare state. Land reform fractured large farms, making them less efficient. Inflation became a persistent issue. Thus, domestic prices were subject to rigid price controls and wholesalers could not pass higher international prices on to consumers, so they could not continue to import. Hence, serious shortages emerged.  Chavez declared the shortages a conspiracy by wholesalers.  This justified his nationalizing food distribution and put the army in control of food.      

Oil prices tanked during the financial crisis, so Chavez cannibalized the oil industry to continue the welfare state. Forgoing critical maintenance and firing the management led to declining oil output, making it even harder to finance the welfare state.

Early in his rule, Chavez passed prison reform and released most of the country’s violent criminals. Surprisingly, violent crime soared throughout his tenure and kidnapping of middle/upper class citizens became epidemic. 

Chavez started a “voluntary” program to get the public to surrender their guns. When that was not enough, he made it mandatory in 2012.  

Chavez died in 2013 and his handpicked successor, Nicholas Maduro, became president at that time. Recently, Maduro, distributed AK-47s to his supporters as protests spread.

In 2015, Maduro claimed the US was conspiring with right wingers to undermine the Venezuelan economy. So, he expelled US diplomats.  Noam Chomsky joined the chorus and said the US should stop meddling, as if Maduro needed help in wrecking the economy or President Obama was intervening in Venezuela.

A steady stream of protestors died over the past year. Hence, the tension is building steadily. When these situations become critical, totalitarian governments are tempted to execute a false flag operation (like the 1933 Reichstag fire) that justifies emergency decrees and the suspension of civil rights. If this happens, there will be a tidal wave of refugees on our southern border.     

Recently, John Stossel asked Noam Chomsky if he was embarrassed by his support for Hugo Chavez?  Specifically, he was asked if socialist policies were not responsible for wrecking peoples’ lives?  Chomsky’s short answer was “no,” because “I was right.” He said, “I never described Chavez’s state capitalist government as ‘socialist’ or even hinted at such an absurdity. It was quite remote from socialism. Private capitalism remained … Capitalists were free to undermine the economy in all sorts of ways, like massive export of capital.”

As always when a socialist economy collapses, the diehards claim it was not a real socialist economy since the government did not go far enough or external forces caused the collapse. Further, Chomsky claims the capitalists sabotaged Chavez by leaving, which suggests they were indispensable! The capitalist exodus was motivated by the prospect of persecution and confiscation of property. How can they be faulted for that?

The Trump opposition group called “Anti-Fa” is a socialist/Marxist organization specializing in street violence. Anti-Fa means anti-fascist; hence, these protestors believe Trump is a national socialist. Anti-Fa’s objective is to prevent anyone they consider to be a fascist from being allowed to speak — slightly un-American and completely totalitarian.  These street warriors have an undeveloped sense of irony.

Bob Martin is the Emeritus Boles Professor of Economics at Centre College.