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'Maduro's Irish supporters don’t see any problem with him crushing rights'

Anything short of a return to a fully democratic path would be a tragic betrayal of the Venezuelan people, writes Victor Duggan.

VENEZUELA IS IN crisis, sliding further towards collapse.

Opposition protests sparked by attempts by the Supreme Court, stacked with loyalists to President Nicolás Maduro, to usurp the legislative powers of Congress have already seen dozens killed.

Perhaps inconveniently for the government, the President’s United Socialist Party of Venezuela (PSUV) had lost their Congressional majority in the 2015 elections for the first time since Hugo Chávez was swept into power by a democratic landslide in 1999.

Shortly after Chávez first became President, he set about re-writing Venezuela’s constitution, giving more powers to the Presidency and laying the foundations for his Bolivarian revolution – Socialism for the 21st Century, as he called it.

Re-writing the constitution 

This piece of history is important, given that President Maduro last week pledged to reconvene another constituent assembly to re-write the constitution once again.

This is seen by many as a thinly-veiled attempt to delay the regional elections scheduled later this year, and the Presidential election scheduled for 2018.

In a certain sense, such centralisation of power is consistent not only with the darkest legacies of Latin America’s history, but also with the anti-democratic outlook of Simón Bolívar himself. He was a liberator, certainly, and a Freemason, but not such a fan of democracy.

Why has Venezuela reached this sorry pass, and why now? 

Coming to power in a country long-ruled by a class of oligarchs who centralised both political power and economic wealth, Hugo Chávez had genuine and charismatic mass-appeal. He also had the great fortune of seeing oil prices surge from less than $10 per barrel when he was first elected to well over $100 on the eve of the global financial crisis.

In a country with the biggest oil reserves in the world, this windfall would serve to fund government programmes to tackle poverty, reduce inequality, and improve healthcare and education standards. And, material living standards did improve.

Inequality, though still among the highest in the world, did fall up to 2006, the last year for which the Venezuelan authorities have made data available.

The commodities boom was a double-edged sword for many Latin American countries 

Following Chávez’s death to cancer in 2013, Maduro, his designated successor, came to power just before the oil price went into a tailspin. Although it has now recovered somewhat, it is still around $50 a barrel, less than third of its peak level of mid-2008. The fall in prices is compounded by a fall in production, down by more than a quarter from its 1998 peak of 3.5m barrels per day.

At the same time, industrial scale corruption had allowed well-connected officials to grow rich on the back of oil money. The golden goose may have stopped laying eggs, but corruption has gotten even worse. Given the country’s dependence on oil for its exports, and on a high oil price to finance its budget (even if it doubled, it still wouldn’t be enough), it came as little surprise that the government turned to the printing presses to raise funds.

Meanwhile, hard currency has been reserved to continue paying China and other international creditors. The impact on ordinary Venezuelans has been devastating.

GDP falling as inflation surged 

Venezuelan GDP contracted by nearly 19% in 2016, coming on top of a decline of more than 10% over the previous two years. With a slight recovery in oil prices, GDP is only expected to fall by 7.4% in 2017, according to the IMF.

By the end of the year, the economy will be more than a third smaller than it was back in 2013. Inflation rocketed to 800% in 2016, and is expected to exceed 2,000% this year.

Behind these dry statistics are countless stories of destitution and human misery. Economic depression and hyperinflation are a toxic mix for living standards. Shortages of foodmedicines and other basic necessities are in short supply. Organised crime has surged and homicides have gone through the roof in what was already one of the most dangerous countries in the world. This is not the revolution the people had been promised.

Back in 2014, public protests were largely confined to the traditional opponents of the Chavismo regime among the wealthier middle class. As living standards spiralled downwards, however, discontent has gone mainstream. Following the electoral setback of 2015, Maduro’s approval ratings have followed a similar trajectory as the economy. Chavismo has lost its lustre, even for many former supporters.

Maduro doesn’t recognise economic realities 

Rather than recognising economic and political reality, Maduro’s response has been to double down on repression, ruthlessly confronting political opponents and protesting citizens alike.

Freedom of expression and a free press, already curbed under Chávez, have been subject to an increasingly vicious crackdown under Maduro. Military tribunals are being used liberally to incarcerate protesters. Thousands have been arrested in recent weeks, with hundreds of political prisoners still reportedly detained.

What is unsustainable will not be sustained. The current political equilibrium in Venezuela is highly unstable. Eventually, change will come, whether at the ballot box or through the barrel of a gun. One must hope it is not too late for the former.

Broadly, there are three plausible outcomes: a) democratic regime change, b) violent regime change, c) further slide towards totalitarianism – perhaps fitting as we near the 100th anniversary of Trotsky-Leninist October revolution in Russia.

Collapse into a fully-fledged failed State is not inevitable

Indeed, many external observers had expected Venezuela to have collapsed by now. A key variable sustaining the status quo is the military, thus far largely loyal to Maduro’s government. Recently, he moved to shore up this support by appointing military officers to senior government positions. In the face of a rising tide of social unrest and Maduro’s constitutional maneuvering, however, this support cannot be taken for granted indefinitely.

In the meantime, collapse into a fully-fledged failed State is not inevitable, but it has become much more likely. Venezuela’s crisis has been a slow-burner, years in the making. But collapse, if it comes, could come quickly, and brutally. The risk is that a violent regime change heralds a backlash that sees a return to rule of the oligarchs, by the oligarchs, and for the oligarchs. Anything short of a return to a fully democratic path would be a tragic betrayal of the Venezuelan people.

In Ireland, some of Maduro’s most vociferous supporters are, ironically, those who make most use of the right to free expression and protest here. It’s a pity that they don’t see any problem with their Venezuelan comrades crushing those same political rights to consolidate power and defend the revolution.

Fundamental and inalienable political rights can be used to secure improved social and economic rights, but they should never be bartered for them.

Victor Duggan is an economist and public policy expert, having worked in the OECD, World Bank, European Commission, European Investment Fund and the Irish Labour Party, as well as in the private sector.

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