Shantytowns surround Caracas, Venezuela’s capital, like the walls of a bowl. Little houses pile on each other on the steep hills, some reachable only by vertiginous staircases.
By Stefano Pozzebon / CNN
Earlier this month, Ingrid Sanchez tried to rustle up votes here for the ruling Socialist Party in Petare, Venezuela’s largest barrio. As parliamentary elections got underway on December 6, she hired motorcycles and jeeps to ferry poor but faithful voters up steep hills to the polling station.
Sanchez has no money to spare — a former teacher, she lives on a state pension worth just one and a half dollars per month. It was the Socialist Party — the late Hugo Chavez’s party — that gave Ingrid cash to pay for the vehicles. But they weren’t Venezuelan bolivars — they were US dollars. And as she counted it, Sanchez realized that the four $20 bills she held were worth more than 50 months of her pension.
“Everything is in dollars now,” she says ruefully — a sign of monumental change in the country that she says would have Chavez turning in his grave.
Sanchez, 57 years old, is a faithful member of the Socialist Party and believes fiercely in the vision of late president Hugo Chavez, who prophesied a Marxist utopia where the state would look after the needs of the people, raise the quality of life, erase inequality and limit private enterprise to a minor role in the economy. “One never loses hope, and that is a project that I still believe in,” she said.
But Venezuela today hardly resembles the one pictured by Chavez. Hunger is rampant, inequality dizzying, and public hospitals stand derelict as the country deals with the coronavirus pandemic. The US dollar is increasingly taking precedence over the bolivar, and while the Venezuelan minimum wage is the lowest in the region, the country’s stock market is booming. Chavez’s successor, current President Nicolas Maduro, recently inaugurated an ultra-luxury hotel where rooms are the equivalent of $300 per night.
All of which raises a question that Sanchez has clearly been wrestling with: Is socialism still alive in Venezuela? “I don’t know, we are doing things upside down,” she says.
When Chavez rose to power in 1998, Venezuela’s wealth was abundant, with some analysts estimating that the country earned almost a trillion dollars from oil revenues between 1999 and 2014 — more than eight times today’s equivalent of the Marshall Plan.
With that kind of money, it was easy to imagine the state as the ultimate father figure. Chavez invested most revenues in programs aimed at increasing living standards and reducing inequality. State television would broadcast hours of footage of citizens receiving state-funded housing, food, and subsidies for agricultural cooperatives. He sent Cuban medical personnel to the barrios to set up clinics for the poor, and launched literacy and education campaigns. In December 2007, he even sent truckloads of heating fuel to low-income Americans in New York and Boston, only 15 months after calling then-President George W. Bush “the devil” at the United Nations.
Throughout his 14-year presidency, Chavez swung between different economic tendencies — though always working to strengthen the state’s command of the economy through price controls, currency exchange regulations, and public spending. He threatened to take over most private companies in Venezuela, but never abolished private property. He attacked capitalism, but never quit commercial relations with the United States
Chavez dreamed of ending the dominance of the US dollar — an emblem of the world’s biggest proponent of capitalism — and creating an alternative currency with which to buy and sell crude oil. “The world is victim of the dollar’s empire. The United States have bought half the world with useless banknotes, […] but the empire of the dollar has reached an end!” he said in 2009.
Ten years later, it’s the Venezuelan bolivar and the Bolivarian revolution that appear to be reaching an end, instead. Even his former protégé Maduro acknowledges that things have changed: Asked by CNN earlier this month whether he thought Venezuela was still a socialist country, Maduro said he thought the “values” of socialism might be fading, referring to new displays of wealth in the upmarket streets of Caracas.
“At times we moved forwards, other times we pulled back. Perhaps today we retreated for what concerns our socialist values. I recognize that,” he said at a press conference.
When oil prices began to fall in 2013, Maduro — who abruptly became president that year after Chavez suddenly died of cancer with no transition plan in place — found himself waging a losing battle against market forces, decreeing price controls on the rising prices of basic consumer goods only to find the products in question disappearing overnight, available only on the black market at a price ten times its official value. As foreign reserves dwindled, he printed stacks of new money, devaluing the bolivar to the point of scrap-paper — and therefore the salaries of most Venezuelan workers.
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