Venezuela – An American Tragedy

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The Exodus of Caracas in 1814

I’ve been asked to explain what I know of the current situation in Venezuela. To do that I need to go back to pre 19th century Venezuela and a little about the people. After all, it is the people that make a country a country. Without its citizens it is simply a habitat.

Most of Venezuela was ruled by Spain from Santo Domingo (present-day capital of the Dominican Republic) until 1717, when it fell under the administration of the newly created viceroyalty of Nueva Granada, with its capital in Bogotá, Colombia.

The colony’s population of indigenous communities and Spanish invaders diversified with the arrival of black slaves, brought from Africa to serve as the workforce in a number of agricultural pursuits. Most of them were set to work on plantations on the Caribbean coast. By the 18th century, Africans had surpassed the indigenous population in terms of number.

With but a few exploited gold mines, Venezuela lurked in the shadows of the Spanish Empire for its first three centuries. However, the country took a more prominent role at the beginning of the 19th century, when Venezuela gave Latin America one of its greatest heroes: a man named Simón Bolívar.

Venezuela longed to be out from under the thumb of the Spanish Empire, and in 1806 a revolutionary by the name of Francisco de Miranda lit the initial flame for that cause. However, his efforts to set up an independent administration in Caracas ended when fellow conspirators handed him over to the Spanish. He was shipped to Spain and died in jail. Bolívar then assumed leadership of the revolution. After unsuccessful initial attempts to defeat the Spaniards at home, he withdrew to Colombia, then to Jamaica, until the opportune moment came in 1817.

The Napoleonic Wars had just ended in Europe, and Bolívar’s agent in London was able to raise money and arms, and recruit a small number of British Legion veterans of the Peninsular War. With this force and an army of horsemen from Los Llanos, Bolívar marched over the Andes and defeated the Spanish at the Battle of Boyacá, bringing independence to Colombia in August of 1819. Four months later in Angostura (present-day Ciudad Bolívar), the Angostura Congress proclaimed Gran Colombia (Great Colombia), a new state unifying what are now the sovereign countries of Colombia, Venezuela and Ecuador (though the last two were still under Spanish rule). The memories of the event are still alive in Ciudad Bolívar, and you can see the great mansion where the first congress debated. Venezuela’s liberation came on June 24, 1821 at Carabobo, where Bolívar’s troops defeated the Spanish royalist army.

Now this is very important for us to understand. Although Venezuela was seen as the least important of Gran Colombia’s three provinces, the country bore the brunt of the fighting. Venezuelan patriots fought not only on their own territory, but also in the armies that Bolívar led into Colombia and down the Pacific Coast. By the end of 1824, Bolívar and his assistants had liberated Ecuador, Peru and Bolivia. It’s estimated that a quarter of the Venezuelan population died in the independence wars.

Gran Colombia and the History of Venezuela in the Late 19 Century

Bolívar’s vision of a unified republic fell apart even before he died in 1830. On his deathbed, he proclaimed: “America is ungovernable. The man who serves a revolution plows the sea. This nation will fall inevitably into the hands of the unruly mob and then will pass into the hands of almost indistinguishable petty tyrants.” Sadly, he was not far off the mark with those statements. The three-province state of Gran Colombia began to collapse from the moment of its birth; the central regime was incapable of governing the immense country with its racial and regional differences. The new state existed for only a decade before splitting into three separate countries.

Following Venezuela’s separation and departure from Gran Colombia, the Venezuelan congress approved a new constitution and—quite incredibly—banned Bolívar from his own homeland.  In fact, it took the Venezuelan nation 12 long years to finally acknowledge its debt to the man to whom it owed its very freedom. In 1842, Bolívar’s remains were brought from Santa Marta, Colombia, where he died, to Caracas and entombed in the national cathedral.  In 1876 they were solemnly transferred to the Panteón Nacional in Caracas, where they now rest in a bronze sarcophagus.

 

The year 1830, when Venezuela achieved its full independence as a separate country, marked the beginning of the era of “indistinguishable petty tyrants.” The post-independence period in Venezuela was marked by serious governmental problems that continued for more than a century. These were times of despotism and anarchy, with the country being ruled by a series of military dictators known as caudillos.

The first half of the 20th century was dominated by five successive military rulers from the Andean state of Táchira. The longest lasting and most tyrannical of these was the General Juan Vicente Gómez, who seized power in 1908 and didn’t relinquish it until his death in 1935. During his ruthless reign, Gómez phased out the parliament, squelched the opposition and monopolized power.

The discovery of oil in the 1910s helped the Gómez regime put the national economy on its feet. By the late 1920s, Venezuela was the world’s largest exporter of oil, which not only contributed to economic recovery but also enabled the government to pay off the country’s entire foreign debt. As in most oil-rich-states, almost none of the oil wealth made its way to the common citizens. The overwhelming majority of Venezuelans continued to subsist in poverty with little or no educational or health facilities, let alone reasonable housing. Fast oil money also led to the neglect of agriculture and to the development of other types of production. It was easier to just import everything from abroad, which worked for a while, but proved to be unsustainable.

Tensions in Venezuela rose treacherously during the following dictatorships, exploding in 1945 when Rómulo Betancourt, leader of the left-wing Acción Democrática (AD) party, took control of the government. A new constitution was adopted in 1947, and the noted novelist Rómulo Gallegos became president in Venezuela’s first democratic election. The inevitable coup took place only eight months after Gallegos’ election, with Colonel Marcos Pérez Jiménez emerging as the leader. Once in control, he smashed the opposition and plowed oil money into public works and built up Caracas. He superficially modernized the country but the mushrooming development did not heal the country’s economic and social disparities, nor did it quell the bitter resentment that lingered from the coup.

Pérez Jiménez was overthrown in 1958 by an alliance of civilians and navy and air-force officers. The country returned to democratic rule and Rómulo Betancourt was elected president. He enjoyed popular support and actually completed the constitutional five-year term of office – the first democratically elected Venezuelan president to do so. Since then, all changes of president have been by constitutional means, although the last decade has seen a few hiccups.

During the prescribed term of President Rafael Caldera (1969–74), the steady stream of oil money flowed into the country’s coffers keeping the economy buoyant. President Carlos Andrés Pérez (1974–79) also benefited from the oil bonanza; not only did production of oil rise but, more importantly, the price quadrupled following the Arab-Israeli war in 1973. In 1975 Pérez nationalized the iron-ore and oil industries and went on a spending spree; imported luxury goods were in large supply in the country’s crammed shops and the nation got the impression that the mythical riches of El Dorado had finally materialized.

In the late 1970s, the growing international recession and oil glut began to shake Venezuela’s economy to the core. Oil revenues declined, heightening unemployment and inflation, and once more forcing the country into foreign debt. The 1988 drop in world oil prices cut the country’s revenue in half, casting doubt on Venezuela’s ability to pay off its debt. Austerity measures introduced in 1989 by Pérez Jiménez (elected for the second time) triggered a wave of protests, culminating in the loss of more than 300 lives in three days of bloody riots known as “El Caracazo.” Further austerity measures sparked protests that often escalated into riots. Strikes and street demonstrations continued to be part of everyday life in Venezuela.

To make matters even worse, there were two attempted coups d’état that occurred in Venezuela in 1992. The first, in February of that year, was led by paratrooper Colonel Hugo Chávez.  Shooting throughout Caracas claimed more than 20 lives, but the government retained control. Chávez was sentenced to long-term imprisonment. The second attempt, in November, was led by junior air-force officers. The air battle over Caracas, with war planes flying between skyscrapers, gave the coup a cinematic, if not apocalyptic, dimension. The Palacio de Miraflores, the presidential palace, was bombed and partially destroyed. The army was called to defend the president, and this time more than 100 people died.

Corruption, bank failures and loan defaults plagued the government through the mid-1990s. In 1995, Venezuela was forced to devalue the currency by more than 70%. By the end of 1998, two-thirds of Venezuela’s 23 million inhabitants were living below the poverty line. Drug-trafficking and crime had increased and Colombian guerrillas had dramatically expanded their operations into Venezuela’s frontier areas.

When it comes to politics, there is perhaps nothing more noteworthy than a dramatic comeback, and that’s exactly what Venezuela witnessed toward the close of the 20 century.  The 1998 presidential election in Venezuela put Hugo Chávez, the leader of the 1992 failed coup, into the presidency.  After being pardoned in 1994, Chávez embarked on an aggressive populist campaign: comparing himself to Bolívar, promising help (and handouts) to the poorest masses and positioning himself in opposition to the US-influenced free-market economy. He vowed to produce a great, if vague, “peaceful and democratic social revolution.”

After his victory in the election, however, Chávez’ “social revolution” was anything but peaceful. Shortly after taking office, Chávez set about rewriting the constitution. The new document was approved in a referendum in December 1999, granting him new and sweeping powers. The introduction of a package of new decree laws in 2001 was met with angry protests, and was followed by a massive and violent strike in April 2002. It culminated in a coup d’état run by military leaders sponsored by a business lobby, in which Chávez was forced to resign. He regained power two days later, but this only intensified the conflict.

While the popular tensions rose, in December 2002 the opposition called a general strike in an effort to oust the president. The nationwide strike paralyzed the country, including its vital oil industry and a good part of the private sector. After 63 days, the opposition finally called off the strike, which had cost the country 7.6% of its GDP and further devastated the oil-based economy. Chávez again survived and claimed victory.

National politics continued to be shaky until Chávez won a 2004 referendum and consolidated his already sweeping power. Emboldened by greater political support and his pockets engorged by high oil prices, Chávez quickly moved to expand his influence beyond the borders of Venezuela, reaching out to other Leftist leaders in Bolivia, Argentina, Cuba, Uruguay, Chile and Brazil. He had openly allied himself with Cuba’s Castro regime, supported the successful Leftist candidacy of Bolivia’s Evo Morales and Leftist candidates in Peru and Mexico who did not win office.

Chávez came out of the Socialist closet during his second term, further increasing public works and social programs to benefit the poor (bringing basic healthcare to the barrios, for example) and nationalizing the country’s largest telecommunication, cement and steel companies, the majority of its electricity industry and many hotels, recreational corporate owned farms, supermarkets, and transport facilities. He has also managed to instill the idea of inclusion in politics among the general population whereas previous governments blatantly excluded all but the highest echelons of society.

Nationalization of industries is what probably contributed most to what was to follow. Farms were broken up and given to the poor to give them the opportunity to provide food for their families and earn a living by selling the production to the nationally owned stores. Despite contributing to Venezuela’s deep oil pockets and an improved life for the poor, Chávez’s popularity started to wane. Infrastructure upgrades, such as improved roads and bridges, shiny new subways and barrio teleféricos (cable cars) kept up appearances, but the decade ended with Venezuela struggling to combat a very serious energy and water shortage, a crisis that has struck the heart of the middle and upper classes. Widespread blackouts were commonplace throughout the country and Chávez called on all Venezuelans to limit their showers to three minutes only (a “Communist shower,” he said).

As 2010 was ushered in, so was water rationing, with Caracas temporarily taking the brunt of the blow: Up to 48 hours per week without water.

Chávez also instilled many controversial policies to combat the country’s wild inflation and debilitating economy, including price controls on basic foodstuffs, a move that, on one hand, allows families to purchase the same amount of basic food with the same amount of money despite inflation; but sparked occasional food shortages of basics like milk and sugar on the other.  In January of 2010, Chávez announced a sharp devaluation of the currency known as the bolívar fuerte—the first since 2005—thus creating a two-tier official exchange rate in Venezuela, a move designed to boost revenue from oil exports and limit unnecessary imports.  However, the people of Venezuela, fearing widespread price increases and astronomical inflation, mobbed imported electronics stores. Chávez condemned stores that raised their prices and acted: The Venezuelan Institute for the Defense of People in Their Access to Goods and Service shut down dozens of stores for price-gouging.

Although Brazil’s controversial approval of Venezuela’s entry into Mercosur was a major victory for Chávez and bilateral trade, Chávez’s foreign relationships weren’t faring much better than his domestic economy. Intelligence officers were sent to Venezuela in 2005 to investigate claims that the Venezuelan Government was allowing Cuban arms shipments thru Venezuela and into the hands of the Colombian Rebels named FARC. I was stationed in Merida where portions of the shipments transited  Following our findings, Bi-national relations with Colombia became extremely fragile over the neighboring country’s participation in supplying arms to FARC rebels and its decision to allow US troops to operate out of seven of its military bases. Chávez banned Colombian car imports and built up troops at the border after several suspicious, cross-border deaths on both sides. Things got personal over these bi-national issues during a private meeting of heads-of-state at the Group of Rio summit in Cancun in February 2010, when Colombian President Álvaro Uribe scoffed at Chávez: “‘Be a man…you’re brave speaking at a distance, but a coward when it comes to talking face to face.” Chávez nearly stormed out.

Despite his waning popularity, Chávez, even after a publicized battle with colon cancer, declared his intentions to run for a fourth six-year term in the elections of 2012.  Again promises toat every citizen receives a monthly stipend regardless of work popularized him at the polls . Electronic voting was initiated and millions of questionable votes were counted as valid. Chavez was indeed reelected in 2012, and while he did begin his fourth term on January 10, 2013, he eventually succumbed to his illness and died less than 2 months later on March 5, 2013.

Vice President, Nicolas Maduro, took over the presidential powers and duties for the remainder of Chávez’s abbreviated term until presidential elections were held. Today, Maduro continues to serve as the president of Venezuela.

That brings us to present day Venezuela.

Venezuela is a vast country with rich resources. Farms flourished through the 20th century. However the nationalization of large corporate farms and the gifting of the food and money producing crops to the poor saw the beginning of declined food production in Venezuela. This is attributed the new land owners lack of experience and in many cases lack of desire to work. Government stipends produced sufficient monies for the poor to live as they were previously accustomed. Not motivated to better themselves.

Nationalization of the oil industry resulted in a drop in production from the wells and refineries. That coupled with the falling oil prices placed the economy in a very precarious position. Venezuela could no longer buy friendship from the faux allies.

Watershed planning was not recognized by the Chavez government as a priority. Monies set aside for these and other infrastructure projects were diverted to financial help to other countries and large arms sales, thought by Chavez as a necessary investment to protect the oil reserves from incursions by other countries. Reservoirs were not properly maintained, hydro projects lay unfinished, resulting in the loss of millions of gallons of water used to produce electricity and potable water to the urban areas. The waters simply streamed out to the ocean, unused.

The lack of education and nationalization of the people have added to the current flow of Venezuelans leaving the country. As stated earlier, the patriots and heroes of the independence years were now gone. Currently opposition leaders are either jailed or killed. The general population either does not have the initiative or the desire to confront the failing government as the judges, military, and police leaders are receiving large paychecks from PDV (Petroleum de Venezuela) the government owned and controlled oil comany.  This results in a disheartened populace deciding to give up what they had and exit the country in search of food, water, medicine and assistance. A patriotic society no longer existed. Well planned social changes in education and the introduction of personal financial dependence on the government attributed to the lack of Patriotism in Venezuela.

Today I live in both Colombia and Ecuador. Here we are experiencing firsthand the plight of these people. I have hired and helped many of them, but it is unfair to the people of Colombia and Ecuador that want to work in their country to give up the few jobs available to foreigners because they will accept less salary.

We can hope to learn from this model. It seems that from its independence to today we may have a very familiar history.