Unfortunately, news of the loan is unlikely to inspire relief among Venezuelans who must wait in long lines to buy bare necessities such as toilet paper. Scarcity of everything from milk to toothpaste has become endemic throughout Venezuela, and store shelves are often stocked with only one brand option — if at all — forcing Venezuelans to overpay for ill-suited products before the available supply runs out.
The intention of this article is not to deride Venezuela, nor imply that the people of impoverished countries deserve the hardships of scarcity. Rather, I want to point out the irony of the Venezuelan economic crisis: a country with such infrastructural and resource potential for domestic production, yet forced to import consumer goods with capital that should have been invested in the promise that once was Venezuela.
In a country where hospitals close their doors and children must skip school to lend their desks to classmates, Venezuela’s investment in imported consumer goods seems misplaced at best.
The news of an increase in imported consumer goods to Venezuela goes hand in hand with the recently published Bloomberg article, “Chávez Friends Get Rich After His Death as Venezuela Slides Into Chaos.”
In the article, the authors depict the tragic Venezuelan social and economic situation, with a focus on retired Navy Captain William Biancucci, one of Chávez’s closest friends. Biancucci owns a cattle ranch in Brazil, from which he exports beef to Venezuela, and he is candid about his plan to buy a private jet to fly back and forth between the two countries.
The paragraph in this article that most sickened social-network users in recent days was: “‘I’m a socialist, but I love having cash in my hands,’ he says, shaking a fist holding an imaginary wad of money.” In the words of the millionaire and 1992 coup participant, “Socialism is wealth.”
According to Bloomberg, Biancucci has grown rich through lucrative government contracts that favor his cattle business. Biancucci’s dedication to the importation of beef and milk to Venezuela is deliberately insidious, given Venezuela’s capacity to produce these products domestically. However, the destruction of private businesses and deterrents to foreign investments enable elitists to continue importing goods, despite how it disadvantages local producers.
Bloomberg’s article also tells of the imported food containers that are repeatedly left to rot at the Puerto Cabello shipping docks, Venezuela’s largest international trade port. Importers have no incentive to intervene as good food wastes away, because the government has guaranteed payment for the produce in advance.
Similarly disheartening is the “surcharge” scandal involving one of Chávez’s daughters, Maria Gabriela, the new alternate Venezuelan ambassador to the United Nations, on the importation of Argentinean rice.
Government corruption and elitist favoritism in Venezuela come at the expense of domestic industry, a phenomenon best evidenced by the increasing rate of imports. El Universal notes that the first four months of 2014 have seen a 32 percent increase over the previous year in the importation of agricultural goods, vegetables, and animal products. Of course, this statistic is not an accurate portrayal of the bigger picture, which must account for the 14 preceding years of compounded economic destruction.
While Venezuela suffers the highest inflation rate in the world, the government continues to neglect the country’s economic potential. In one of the great ironies of our time, Venezuela remains blessed with the world’s largest crude oil reserve, while Venezuelans are left to live impecuniously, unable to select even the shampoo that they desire.
It is unfortunate that the greatest legacy Chávez left behind is so contrary to the prosperity that he preached.
We can now observe the enrichment of a minority and the impoverishment of the majority, an unprecedented national currency devaluation — a recent college graduate in the 1980s could earn a $1,000 a month salary, whereas $100 is the new standard — the highest inflation rate in the world (152 percent in 2014, according to the Cato Institute), and a tremendous waste of human capital, as professionals and entrepreneurs emigrate.
One gets the impression that all Venezuela’s white-collar thieves were carrying out the trick, while Chávez told stories of socialism and dreamed of utopias on television. One almost feels sorry for him. But no. They both share the blame.