Tuesday, April 2, 2013

Chavez and "Capital" Punishment

Daniel In Venezuela wrote a good post a few days back about the condition of his country after Hugo's merciful death.

The country that Chavez left us is a country that is financially ruined. True, we still have a lot of oil under our feet and good management can bring us back to a semi functional state in as little as half a decade. But the bonanza of the last decade will have been spent with very little to show for it. It has been swallowed by corruption, inefficiency and gifts because what Chavez has done is to distribute cash around, never establishing anything productive and sustainable over time. Nothing.

All of Chavez Misiones were designed for electoral purposes, to improve somewhat the everyday life of the masses without providing them with access to a real pay check, those that are given to people that actually produce something of value, any value, and which allows them true independence. We can argue ad infinitum as to the need to address poverty in Venezuela, but everyday it is clearer that Chavez social programs have not been the solution, a Band-Aid at best, with the nagging after thought of having made things actually worse in solidifying a “47%” mentality.

Chavez, like all government despots [in democratic countries as well as dictatorships] ignored capital maintenance in favor of using the money to buy votes. As a result, the once fairly well-developed capital structure of Venezuela has been left in close to third-world shambles.

It is capital investment that creates economic growth and Chavez not only ignored the country's infrastructure but those of the industries he nationalized, too. Venezuela's oil industry which is the country's main income provider has been brought to its competitive knees through lack of maintenance, modernization, and the wholesale politically-motivated firings of its best managers and engineers (many of whom found employment in Canada's oil-sands).

No matter who wins the elections to replace Chavez, he will be faced with a country that's been set back several decades during the one decade that Huguito was in power.